If all you need is Neighborhood support to transfer files, just use an FTP program on the Xbox. Simple.
XBexplorer can be unreliable even in the best of scenarios (as if Neighborhood is any better). FTP is my preferred way of doing things anyway.
Thanks, I'll keep that in mind! I've had issues with FTP on my PS3, I could never get Filezilla to work think I had to use a trial of a different software because I didn't have a cross over cable, I don't really remember. Will I run into similar issues here?
It is a VM, but you can setup "Shortcuts" to applications inside of it to make it look like it's running native on your windows 7 machine, which I like. Screenshot below http://i.imgur.com/goNKNjy.jpg?1