We’ve also learned that many of you (millions) are running Windows 7 Beta full time. You’re anxious for a refresh. You’ve installed all your applications. You’ve configured and customized the system. You would love to get the RC and quickly upgrade to it from Beta. The RC, however, is about getting breadth coverage to validate the product in real-world scenarios. As a result, we want to encourage you to revert to a Vista image and upgrade or to do a clean install, rather than upgrade the existing Beta.
We know that means reinstalling, recustomizing, reconfiguring, and so on. That is a real pain. The reality is that upgrading from one pre-release build to another is not a scenario we want to focus on because it is not something real-world customers will experience. During development we introduce changes in the product (under the hood) that aren’t always compatible with what we call “build-to-build” upgrade. The supported upgrade scenario is from Windows Vista to Windows 7.
Many users might ask why you'd need go through the pains of a fresh install. Simply put they want to make sure none of the old code might be carried over. MS wants to make sure that any of the new bugs that are reported are reported from a fresh build that has all the latest fixes and no potential hold outs from the earlier releases.
In their post Microsoft reiterated earlier statements that it will not offer an in-place upgrade to Windows 7 from Windows XP. "We realized at the start of this project that the 'upgrade' from XP would not be an experience we think would yield the best results," the company said.