A. If all other options to get an application to run on Windows 7 fail, including shimming and looking for an updated application or replacement, one option to stop the application from blocking your Windows 7 adoption is to deploy XP Mode (or, preferably, Microsoft Enterprise Desktop Virtualization—MED-V—for enterprises). This option gives you a Windows XP environment where you can run the legacy application and still have it integrate with the Windows 7 desktop.
Now let's say that Windows 7 desktop is hosted in a VDI environment. Does Microsoft support running XP Mode or MED-V inside the Windows 7 VM? No. A VM within a VM isn't supported by Microsoft. The better option would be to use third-party technologies, such as those provided by Citrix, that allow a user multiple VMs. One user could have, for example, Windows 7 and Windows XP VMs. The legacy applications run in the XP VM and are then streamed onto the Windows 7 VM desktop (giving the same usage and visual experience as XP Mode).
Another option would be to use a Windows Server 2003 server with Citrix technologies to publish the application only to the Windows 7 desktop, but that assumes the application will run correctly on a server OS.