The following is MY personal preference...
I prefer XP as Vista does not offer enough benefits to make it worth the switch and effort (yet).
XP has been around a lot longer and therefore there are mountains more software and help available for it.
Before anyone says 'DirectX 10' only works on Vista, please remember that you don't need DirectX 10 for MP on a HTPC.
Yes, the MCE remote works with MP 'out of the box'.
You'll find that the IR Server Suite or MCE Replacement driver will offer much more functionality then the standard MS drivers for the remote so you'll end up using them as you can configure it exactly how you want and not how Microsoft dictates.
Yes, that setup should be sweet though you neglected to mention your TV card...