Windows 7 recognized almost all of my hardware! Almost as good as Ubuntu with only 5 times the bloat.
All this is great, and it blows XP out of the water. However Ubuntu has been doing this well since at least Gutsy. With Feisty, everything but my card reader worked. Since Gutsy, ALL of my hardware works out of the box.
I think Microsoft has done a great job with Windows 7, and I really hope they overcome the stigma they earned with Vista. So far, I am enjoying my Windows 7 experience. It's snappier than Vista was, and prettier than XP. My favorite part is the new taskbar that replaces Quick Launch. Absolutely brilliant design.
With Gnome-Do, Ubutnu still takes the cake in my opinion though.