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Its a complicated question. XP is a stable, well proven OS environment, because it is already 6 years old and has had all the major bugs that come with a new OS ironed out of it. When XP was new, people hated it, much like people hate Vista now. Vista is comparatively new, and so still needs some refinement.
My parents have a relatively middle-to-high end laptop running Vista Home Premium, and it runs fine, its not noticeably slow for the most part, though if it were running XP it would be a lot faster. 1Gb of Ram is an absolute minimum with Vista I feel, more if you can, and steer well clear of Vista Home Basic.
The XP-Vista Gap - I'd liken it more to the 95-98 gap than the 98-XP gap. The difference is this time, Vista looks a lot more different than XP, whereas 95 and 98 had a similar look. I would consider Vista to be an evolutionary development from Xp, not a revolutionary one. The choice at the end of the day is yours - but keep in mind, XP is going to get out of date a lot quicker than Vista is.
Despite its shortcomings, Vista is a lot, lot better than Windows ME. It has similarities to ME (which was basically a jumped-up version of Windows 98SE with badly-integrated add-ons), but at least Vista is stable. A lot of Vista to me is unnecessary and resource-intensive eye candy, but on the whole, its not too bad...
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Vista or xp?
what do you prefer vista or xp?
is vista worth the money?
and most importantly is the xp-vista gap same as 98-xp gap?