1. I would never do this until I have moved every bit of personal data that I wanted to keep. That includes things like address books and favorites (bookmarks). Once it’s gone it’s gone.
2. I wouldn’t upgrade - I would do a fresh install. Don’t carry over old problems to your new OS.
3. If you don’t have another computer around so you can chase after drivers I would ensure that whatever model of computer you have is compatible with Win 7 and that I had all the drivers I would need before I launched into the project.
Study up before you commit!
For #3, it shouldn’t be an issue, since he bought the computer from the manufacturer with the upgrade credit as part of the package. They don’t sell those packages unless the hardware and drivers are compatible with the upgrade, it would be a tech support nightmare otherwise.