Answering these questions in any detail would require more time and space than can reasonably be expected in a forum, but I will have a stab at pointing you in the right direction.
Thank you for your effort :-)
1. and 3. Impossible to answer this accurately without knowing all about all your applications. KMS can also handle Office activation, and I see no reason why you cannot build an image with apps installed. If you have any application packagers in your company - work with them, as they should understand which apps have user profile settings that need to be handled correctly. However, that is what application packaging is all about - converting dodgy vendor installs into installs that work in an enterprise environment. Building a driver library is standard procedure for windows builds and is much easier in Windows 7 than XP as & will recurse through the driver folders looking for any driver match. If you have not already done so, download the Microsoft Windows Automated Installation Kit for windows 7 and spend some time working through the documentation.
I am a one man it-support department and I don't have the tools or the knowledge to package software for remote installation. That is why i have found the "old way" of installing drivers and software, customizing settings and then creating an image that is distributed as is without sysprep very convenient. There are many settings that need to be adjusted (network printers, filetype associations, display settings, media player settings etc.) to make life easier for our end users. If sysprep forces them to use most sofware with default settings then that will be a step in the wrong direction from their point of view.
Does sysprep really remove all the device drivers I have installed manually prior to sysprep? Not a problem with chipset drivers if the driver folder is available, but will the network printers I have configured work after sysprep?
Another driver related problem is display settings I mentioned above. If I have a computer with a monitor and a projector in clone mode, will that survive the sysprep process? GSS can restore old display settings (most of the time) with the way I currently use it (cloning without sysprep).
2. Sysprep removes licensing information so that each machine will need to be reactivated/relicensed when the machine first starts up. KMS is the simplest solution for enterprise environments. When you create a new image from an old one, you will load the old image, which has been sysprepped once, make changes, and sysprep again. This works for up to 3 syspreps and then no more are allowed, unless you use the rearm switch which effectively resets the sysprep counter to 0 or 1. Googling is a good way of finding specific information on this type oif topic.
Terry BU:s answer suggests that KMS users don't neet to rearm, so "skiprearm = 1" should be used?
5. Ghost should be able to do this for you, but again, there are many different solutions that users have implemented. One novel solution was to code the workstation name into the BIOS using the asset tagging option, and then retrieve this information using WMI during the first boot. The machine could then be finally configured by control scripts that run on first boot.
I hope the old way works (GSS restores old settings), guess I'll find out during testing.
6. Again, impossible to answer without knowing exactly what hardware is involved. I can generalise to the point where I can say that any machine whose hardware is capable of having Windows 7 installed on it, and for which suitable drivers can be found for all devices, can be updated from XP to Win 7 using Ghost, as long as the image has the correct drivers in the driver library and is deployed with the appropriate 32 bit or 64 bit version of Win 7.
The computers do support Windows 7, we intend to move from 32 bit Windows XP to 64 bit Windows 7. I was only worried about possible limitations in GSS that would prevent replacing Win 7 with Win XP with a normal multicast session. If the HD has to be wiped and the new image restored manually on each computer, the operation would last much longer.