Favorites, settings, Quickbooks, etc. photoshop,
Now hmmm... Files as long as you know where they are on the old machine and where they need to go on the new one are one thing, but each of the above has it's own challenges and procedure. Read up on this link first, but be aware that even the utility described may or may not do everything you expect it to..
http://windows.microsoft.com/en-us/windows7/help/upgrading-from-windows-xp-to-windows-7?T1=tab03
Hopefully that util (or if someone here has used a better one out there) does it for you, but if not.. then it gets a bit "complicated" ... Keep in mind that you WILL have to reinstall programs - no getting around that. Just copying the files under "program files" rarely does what you want, and usually you end up with a program that only half works, then half bombs...
Other items to consider... For example.. favorites... depends, Lee.. Firefox and Internet Explorer both keep this information stored two different ways. Firefox is definitely much more "self contained" tho as far as what you have to move over, how you do it, and when you do it; IE... well.. yeah it's a little more spread out..
Settings in general are usually stored in what is called "the registry". There are several ways to get this copied over, none pretty.. and since you're going to basically a different "family" of windows, I wouldn't recommend it (it would be safer to go to server 2003 from XP since it is also built with the same "foundation", as an example)
Not to scare ya too bad... but I would try the easy transfer utility.. and the ONE that is for windows 7. I would try that first, but also AFTER all of your programs have been installed. Or someone else here can suggest a good, SOLID utility that would do this for you. I can't recommend any because I usually (still) do it all the hard way... install the OS... install the programs... copy DATA only OR where it is straight forward to do a full FORKLIFT of a program and it's settings, then reconfigure the programs I couldn't just forklift over.