How to install XP on a Sony Vaio P
No netbook should be running Vista. Period. Exclamation point. Dell Mini 9 smashed repeatedly into the bridge of Steve Ballmer's nose. And that even goes for the beefy-for-a-netbook-but-don't-call-it-a-netbook Sony Vaio P.
Luckily, the process of downgrading the Vaio P's built-in Vista install is relatively simple, with the only casualties being volume and mute buttons that no longer work. A small price to pay for not running Vista.
replacing vista with xp on the vaio p [Pocketables via Hack-A-Day]

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With all the good reports about it I'm surprised they didn't just do Win7?
The hardware is certainly up to it.
I've installed the Win7 beta on my old laptop (1.6 GHz dual-core, 1GB RAM, integrated graphics, tablet) and it works quite well. Better than XP, especially in terms of networking -- except that Explorer hangs with alarming regularity. Not quite ready for prime time. I don't think I'd trust it for my main computer just yet.
Windows 7 is still a "protected path" OS. I don't buy computers so they can prevent me from doing what the law allows, but the RIAA/MPAA do not.
From what I've heard from a friend, installing XP means you lose the GPS and WWAN capabilities as well unless you go through some PITA process to extract the drivers.