Microsoft have said alot of things, they even said there would be a new file system with Vista.
What Vista does when first going on is save the exiting Windows installation folders(Windows, DocumentsandSettings, Program Files) into a renamed folder called Windows.old. As far as losing drivers just reinstalling XP will require reinstalling all drivers and programs as well.
i wish i knew the guy so i could tell him that. the way he was talking, the drivers were gone...not on there at all. but i guess he didnt know about the .old file.