Thank you, I appreciate the help.
I was able to sucsessfully partition my hard drive into two primary partitions, and installed Windows 7 on the new Primary partition while leaving Windows XP on the other.
As an afterthought, however, I decided to resize the partitions, to make space for a 3rd primary partition I will be using as storage.
So, I resized each primary partition, and now I have 2 logical drives aswell as the two primary partitions. These logical partitions are the unallocated space I freed up when I resized the two primary partitions.
How can I combine these two logical partition? I would like to create 1 primary partition out of them, but the only option I see is creating two seperate primary partitions.
P.S. I used EASEUS so far, but I have Gparted ready on a LiveCD if needed.
Edit- To clarify what I'm trying to accomplish, I've attached a screenshot.