I have XP Home. How do I know if it is 32bit? Can I upgrade to 64bit? Are there any drastic changes with doing so and/or having a 64bit OS?
XP Home only comes 32-bit, there's no 64-bit version of it. 64-bit XP (XP Pro) lacks driver support, it's just horrible, don't get it. If you want 64-bit Windows, Vista is pretty much the only viable option you have.
If you're upgrading to Vista I recommend you get Home Premium or if you wish to shell out the money for some extra features and bragging rights, Ultimate. As I said, there's no point in upgrading to 64-bit XP as chances are there are no drivers for some of the stuff you have.
As for the actual differences between 64-bit and 32-bit windows, the most significant differences are 1)you get to use 4GB+ RAM and 2)you need to use a different set of drivers. 64-bit versions of Vista have decent driver support otherlike 64-bit XP, so that's no concern... there are other things you need to take in consideration as well, though. Some programs don't work with 64-bit Windows (usually this goes only for programs that need to install kernel mode drivers, such as anti-virus software, firewalls, and, well, drivers for your hardware, but sometimes "normal" 32-bit software fails as well). Usually, though, you'll be fine running your 32-bit apps on 64-bit Vista. Also, 64-bit Vista comes with 64-bit Internet Explorer, and some plugins are only available for 32-bit IE, so if you use IE and want plugins you'll need to do some tweaking to set the 32-bit IE as default.