Upgrading Ubuntu won't break dual-boot with Windows 7 as grub is explicitly intended to support booting more than one operating system. Certain upgrade operations in Ubuntu, such as upgrading the kernel) will trigger a process that searches for all available operating systems on your device and updates the list presented to the user each time you start the device. In this way grub will always preserve the ability to start all your operating systems.
That being said, upgrading to Ubuntu 11.10 at this time (just past Alpha 2) should work fine, but could possibly break things. Unless you are prepared to file bug reports and possibly do some occasional troubleshooting to get back up and running I suggest you wait until at least Beta. I am currently running Ubuntu 11.10 Alpha 2 with updates and most things are working, but I know at any time it could change.
Btw, the boot loader for Windows 7 is much different from the boot loader from Windows XP, so don't be dissuaded by any reports of problems with Ubuntu and Windows XP. No offense meant to that poster, just pointing it out.