Your job: Install a new computer for a client and transfer all the documents. The old box is a Windows XP, the new one runs Windows 7.
The tool: Windows File and Settings Transfer Wizard.
The caveats: Many.
It's a well known story. Your client has a new computer to install. She's used the old one for quite a while and it's full of documents (in weird places), although you've suggested storing them on the server, "just in case". But old habits die hard.
Thankfully, Microsoft has a pretty good tool for this case, namely the Files and Settings Transfer Wizard. This baby does most of what you'd believe it show and it's been bundled with Windows since the XP times.
Step one: get an external hard disk or a fairly large USB flash fob (thumb drive, "minnepinne"). While you could do this over the net, it's probably faster over the USB. Nothing will be deleted from the external device so don't worry about that bit.
Step two: Start the process from the new computer. Plug in the external memory device and fire up the F&STW. While the old one probably has the equivalent software installed, the file format has most likely changed between your brand spanking Win7 and the old XP box. This was learned The Traditional Way.
You do not need to be logged in as the user whose data is to be transferred but you will need admin rights on both the source and the target box.
Now tell the Wiz that you are on your new computer and that you haven't done the transferring bit just yet. FSTW will create an installer on the external disk, after which it'll close (given a button-push or two).
Step three: Eject the external disk and plug it into the old computer. Run the installer created above. Start it and press the appropriate Next buttons. The transfer will commence. Have tea, this'll take a while.
Step four: Again, eject the external hard disk, plug it into the new computer. Navigate to where you created the transfer files (which probably is where you left the installer a few steps back) and open up the .MIG file there. This will awaken the FSTW anew, to let you drop the files and settings on the target computer.
Let it churn. Have more tea.
Step five: Check trough the transfer logs. Save the log for transferred files. Resist the urge to check trough the list of applications missing, and even more so, resist the urge to install the missing programs on the target machine. This, too was learned The Traditional Way.
Reboot the target computer. This will not be evident until you continue stepping through the logs. This, also, was learned The Traditional Way.
Step six: Surprise surprise, FSTW has not transferred the Outlook .PST Data Files from the source computer. Eject the external disk from the new computer, plug it into the old. Open the Control Panel from the old computer, open the Mail applet, check which Data Files are in use, click each one and the button to show the actual folder in which the .pst file is in. Outlook must not be running while doing this. Exit it, completely. Old Outlooks will leave a thread hanging to check for new mail.
Manually copy the .pst files to the external medium. Eject disk. Plug it into new computer. Create a directory c:Users%username%Outlook and manually copy the .pst files from the external disk into it.
Only now, start Outlook on the new computer.
At this stage, i have no idea if Outlook will have its settings transferred or incorporate the .pst files on the previous computer, as this too was learned The Traditional Way (or more so, Obscured in The Traditional Way) so you're on your own here. The only thing to add is that you can use the Mail applet from the Control Panel to add the .pst files to the new account if they aren't there from before.
Apart from that, Good Luck. You're a sysadmin, and you need it.