After a little bit of experimenting, I can officially say that the answer is YES!
Just today, I downgraded my Packard Bell Easynote MX37-U-004 to XP from Vista.
It took me a while to get all of the drivers needed, as a lot of them insisted on only working on Vista, but after a couple of hours, and knowing what the devices on my machine were, I managed to find all of the needed drivers to make my machine run properly, and I can say honestly that I'm more than impressed with what I have found out!
My laptop now runs a lot faster than it ever did with Vista, and should be even quicker once fully upgraded next month. I'm looking to set it up with a 500GB S-ATA hard drive and 4GB of PC5300 to make an adequote gaming machine. Along with it's dual core processor, I'm looking at having a hell of a laptop! Should be perfect for gaming!
Danny