In each OS, you must turn
off system restore on
every drive except the OS and where its apps are (if different).
It follows that apps
cannot be on a shared partition, though the data they use
can be.
You should end up, on both systems, with system restore only enabled on one (or 2) drives, and those drives should be different on each system.
There should not be
any drive which has system restore enabled from both OSs. If one restore folder can be seen by both systems, it will be corrupted by XP, and Win7 will have a broken chain to which its only response is "start again".
Check the above, set a W7 RP, boot XP, check that explorer can't open W7 files or see its apps, boot W7 again and check that the RP is still OK.