Windows.old takes up about 6 gigs. Is this essential if I do not need to load XP? Is there a special way of removing it? Or must it stay? I am low on space at the moment.

You better can't remove that cause it's a backup from your windows XP.
So if you delete it there is no way of going back

P.S You could read it during the install of Vista (setup of vista)

I was under the impression that downgrading hasn't been enabled yet, meaning that the upgrade is a one way trip...

reverting to an old build in not available, the windows.old file is there incase you chose to use the migration wizard to migrate files from it, also so you can pull anything that was missed by the migration, you can delete it if you have all your files and folders that you need in vista.