If your XP machine is only used for storage, then there’s really no reason to update it. If you connect to the internet with it for browsing or email, then you’re potentially exposed going forward, as hackers are going to go into overdrive trying to roll out new exploits.
An alternative would be to take the drive out, and put it either in your Win7 PC as a second drive (assuming an open bay), or into an external case that you can hook to the Win7 machine via a USB cord. That would give you access to the photos.
A better option, assuming you’d be devastated if you lost those photos, would be to upload them to a web-based file storage service (DropBox, Google-drive, SkyDrive, etc.), where you can access from anywhere, and not risk a hard-drive failure and loss. Then you could “decommission” the XP machine.
If you don’t want to have your photos out on the internet, regardless of assurances about privacy, safety and security, then buy a USB back-up drive (1TB drives can be had for $60 or $70) and take copies of everything you want to keep. Encrypt and password-protect your backup drive, and store somewhere away from your main PC. You’d then have the original drive AND a backup, just in case.
If you use IE, XP won’t upgrade to the latest versions, and a lot of websites now won’t even work with IE8 or earlier versions.
I use the W7 hard drive for everything else. Might be something worth looking into.