The upgrade option is only for upgrading from Vista (and it only works for specific versions of Vista I believe). You'll have to do a fresh install if you have XP or dual boot (choosing to run either XP or Windows 7 when you start up the computer).
However, it would always be wise to back things up. You can back up game saves if you're worried about your progress. Backing up your files can be as simple as drag and drop. Stuff like USB flash drives, CD's or DVD's, and external hard drives are some storage methods to look into.







