A while ago there were some rumours floating around that IE7 would be a compulsory upgrade for WinXP users. Luckily it turns out that it's not actually mandatory but something that will be recommended by default in Windows Update.
Personally having used IE7 through various beta releases, comparing it to both IE6, Firefox on both the PC and Mac and Safari I have to say any Windows user who chooses not to upgrade really needs to think about why they're not upgrading.
Despite the rhetoric of the usual detractors, the feature list for IE7 is pretty awesome (even leaving aside the marketing hype from the IE7 team!) - improvements to security, stability, rendering, CSS support, Phishing and malware protection and (last but not least) the UI (thank you for Tabs!). The best news is that they've said that IE7 isn't going to be a one-off left to gather dust (like IE6 when Microsoft appeared to decide that they'd won the browser wars and didn't need to bother any more) but the first of a whole series of incremental point releases.
IE7 has dislodged me from Firefox which for about a year was my browser of choice without question on the PC (and neck-and-neck with Safari on OSX) - which is great because I don't have to fire up another browser on the off-chance I'm visiting a site that needs ActiveX (very rare these days admittedly. The only one I use regularly is the excellent eWise account aggregator) or for some reason explicitly checks for IE before letting you in (for some reason less prevalent than the rabid Firefox only sites... but some banks seem to think IE is the only browser out there!)
With IE7 a lot of the reasons to make one of the alternatives the default browser on your system have gone away. IE7 had brought the UI up to a level comparable with the Gecko based browsers, the security - while not perfect - is a lot better (and don't forget... Firefox has had some bad security scares recently as well) and while users get very attached to some of the scripting options available (eg GreaseMonkey) they can open up security risks and display problems with the sites you're visiting!