1GB of RAM is too small these days. We are hearing 8GB-12GB of RAM these days coming out with newer computers. Also 20GB of installation might sound big but as again with RAM, hard drive spaces have been increasingly astronomically and the prices are shrinking down. 250GB is the norm these days. When Vista came, the specs looked too huge because at that time, these werent the in thing. But when Windows 7 is releasing today, its perfectly fine to have that kind of minimum requirements.
If you are planning to buy a new PC, I am pretty sure you wont opt for XP over 7. That would be so silly.