Does anybody know of a good external hard drive that is compatible with both Windows XP and Windows 7?

So here’s the deal: My old PC (which runs on XP) is on the fritz, and I’m in the process of transferring files over to my new laptop (Windows 7). I wanted to transfer my iTunes library over via my external hard drive, but it says that in order to run a sync for Windows 7, I must delete all files synced as Windows XP from the external hard drive. So, this is no help in trying to transfer iTunes.

I imagine there is a decent external hard drive that will work between the two systems, I’m just not sure which ones will. Any help?

FYI: The current external hard drive that is not working is a Seagate – FreeAgent Desk 500GB.