Mine works fine on Windows 7. I changed all of the compatibility settings to Windows XP SP3, but you can only do that in Windows 7 Ultimate.
All Win 7 versions offer the "Compatibility Mode" setting.
You may be thinking about the thing called "XP Mode" which is really just a Virtual Machine that runs a copy of XP within itself.
That is different than the Compatibility Mode settings.
The XP Mode virtual machine is not available in lesser versions of Win 7 below Win 7 Pro. Win 7 Pro and above is where the XP Mode virtual machine was allowed to be installed but none of the Home versions would allow install of the XP Mode virtual machine.
The Compatibility Mode settings are available in all versions of Win 7. Win XP and Vista versions also offered the Compatibility Mode settings.
The XP Mode Virtual Machine can actually be installed and does run on Win 7 Home Basic and Premium but it takes some trickery to get it to run. The Win 7 Home versions license does not actually allow it from a legal perspective though.
There is an article at the tomshardware website that explains how to install and run XP Mode on any Win 7 version though.
I've found that almost everything made for XP will run just fine if you installed the 32 bit version of Win 7. It's the 64 bit version of Win 7 and higher that cause problems as a lot of older hardware does not offer 64 bit drivers.
For my "radio" computers, I'll often install the 32 bit version of the OS as I work with a lot of older hardware.
Even then, there are 16 bit applications or below that will not run on Win 7 32 bit. For those, you either need XP Mode installed on Win 7 or keep a few old computers running that have old OS's on them. I still keep a couple MSDOS machines running as well as Win 3.11 machines. I usually have dual or greater drives in those machines that also contain Win 95 or 98 for dual booting into about anything. Many are old point of sale machines that had 4 motherboard mounted serial ports on them as you could never have too many real serial ports if messing with old radios and 8 or 16 bit software! Most of them allowed for custom IRQ's to be set for each serial port in the BIOS so you could actually use all 4 ports at the same time.
For those Win 7 machines that I did need XP Mode installed, I'll always install the 64 bit version of Win 7 so the machine could take advantage of greater amounts of ram. XP Mode can only use just over 3 GBytes of ram or virtual ram just like the real 32 bit XP.
I think Microsoft recommends that XP Mode be installed on a 64 bit machine with 4 or more GB of ram (I recommend 8 GB or more) so XP Mode itself does not slow down the real machine that much.
That allows you to still run Win 7 software outside of the virtual XP Mode machine without a large performance hit.