Does Windows 7 require a full Vista (or XP) Install, or just insert CD?

If Ultimate does everything you want, I would not disturb it. Now as you have a coupon for 7 upgrade, yes you can install 7 as a fresh install, however, there may be a few "gotcha's". It may not be a generic disk and may be keyed to a particular manufacturer or motherboard processor combination. Even if this restriction does not apply, it will likely require the reuse of the Vista key. Once the 7 is registered, support for Vista ceases. If you push the issue and try to update both Vista and 7 on the same license expect to have both machines with the "invalid" icon in your system tray and neither will be allowed downloads.

Because your version of Windows 7 is meant to be an upgrade, you'll probably need to use your Vista product key somewhere. It should be on the bottom of your laptop. But as long as you use your Vista code, you should be able to do a clean install on whatever computer you want. Clean installs are better than upgrades anyway. However, I would imagine this will invalidate your copy of Vista. I would recommend using 7 on one computer and XP on the other, but you're welcome to try using Vista on one and 7 on the other.

i know you cannot go from XP > Windows 7 without formatting HDD >>

Vista to > 7 is possible. Windows 7 is ALOT better than vista and you will not be disappointed with it.

W7 will run alot smoother than vista on a laptop.

Hope this helps a bit.

i know if you have vista you just do a upgrade but if you have xp you will have wipe your hard disk to use windows 7