I'm posting from Windows 7 on my laptop which I installed last night... same problem as you with the Intel 852/855GM graphics. Damn shame - everything else seems to be working great, but having to work in 640x480 resolution is a dealbreaker. Spent a few hours on this trying many tricks I've found on the web to make the XP drivers work, but no good.
Can't fathom why they wouldn't support the 852/855 considering so many laptops (which can otherwise run Win7 fine but can't have their graphics card updated) use it... how difficult could it be?! Hopefully this changes before the final Win7 version comes out or I won't be a happy camper and neither will a lot of others.
EDIT: just a few hours after writing this, I got it to work. For some reason it wouldn't work with the latest drivers direct from Intel, but when I installed the ones from Dell (my laptop is a Latitude 100L) it finally worked. Had to right-click the Dell executable and set it to run in XP SP2 compatibility mode, though.
If any of this applies to you, you might have to do bcdedit.exe /set TESTSIGNING ON and/or bcdedit /set loadoptions DDISABLE_INTEGRITY_CHECKS to make sure the drivers stick... been working like a charm for me.