It really doesn't matter where the partition is actually located on your hard drive. If you have only one HDD, it doesn't matter if the new partition for windows 7 is at the beginning or at the end. As the matter of fact it doesn't even matter if you have multiple HDD in your system.
When you install windows 7 just choose the partition you want to install, when it finishes and boots up you will see the Windows 7 and Older Windows OS. (in your case the old Windows OS is your XP)
Windows 7 installer does everything for you, you don't even have to worry about those bootloader etc.