After many requests for this information, I have drafted this general guide to help.

Take note: Regardless of flavor of Windows 7 or if it is 32/64-bit that you will be installing, the steps listed here are the same. The only difference would be which product key is entered to determine which flavor of 7 is installed.

Important Information

This guide assumes a "clean" installation and not an "upgrade" from a previous OS. Ensure that you backup all of your important files (documents, music, etc) to CD/DVD/another hard drive before following these steps.

If you are using Hard Disks in a ACPI or RAID setup, you will first need to download the latest Windows 7 compatible (32-bit or 64-bit) for your particular hardware before installing clean. Check with your chipset/hard drive controllers manufactures web site for the latest drivers/information before starting.

This guide is for OEM (purchased separately from the computer) and retail versions of Windows 7. Installation instructions specific to computers with "recovery partitions" or recovery DVD's are very different. Consult your manufactures instructions for details

After configuring the system for booting from a DVD, the Windows Setup screen appears.
At this point, Setup is loading the driver files it needs to continue with installation.

The next screen is a more graphical progress bar indicating Windows 7 is still working in the background.

The first options you will come across are selections for Language, Time and currency format, and Keyboard layout. Make your selections by using the pull down menus and press the Next button

Here we have the option of repairing a previous installation or "Install Now." Since this is a clean installation of Windows 7 and not a repair, Install Now is the proper choice.
Highlight the "Install Now" button to continue to the next screen.

Windows 7 is working in the background. This may take several minutes depending on the system.

Here we see the License Agreement you must accept before continuing.
After reading the agreement, check the box next to "I accept the license terms" and select Next button.

Here we would be able to choose an "Upgrade" install (if running setup from a previous version of Windows, such as Vista) or a "Custom" (clean) install.
Select the whole box containing "Custom (advanced)" to continue to the next screen.

This is where you can select which hard drive/partition to install Windows 7 on. Since this system only has one hard drive, only one place Windows 7can go. Advanced options are shown in the next screen shot.

This is also where you would install drivers for your ACPI/RAID/SATA controller by using the "Load Driver" option. After the installation of the ACPI/RAID/SATA drivers, your hard drives should appear as shown on the right. If no additional drivers are needed, select the Next button.

The advanced options allow creation of multiple partitions and the option of formatting existing partitions. After finishing your particular partition configuration that you desire, select the Next button.

Here is where Windows 7 installs major components of the OS. This process can take 10 to 60 minutes depending on the system.

Here we see the system needing to reboot to continue installation tasks.
You can hit the Restart Now button or just allow the reboot to happen automatically after several seconds.

Here we see progress as Windows 7 updates the registry settings. This process may take several minutes before going to the next screen.

Windows 7 starts up required services at this point in the setup process.

Windows 7 continues to install at this screen.

After initial setup is complete, another reboot is required with no user input.

This is the screen you will be greeted with upon each boot. Windows 7 is starting up!

Setup is now preparing the system for initial booting. Unlike the previous screen capture, you will not see this on each boot.

18) Video Test: 

Here is where Windows 7 tests the systems video performance to see if Aero will be enabled or not. This test will only last a few minutes.

Here is where the initial account creation happens. This user will have full administrator privileges and automatically be logged in after setup is completed.

Enter in your user name and computer name as you would like it to be identified on the network and then select the Next button.

This screen prompts you to enter a password for the account that you just created. I highly recommend that you password your account. Enter it twice, then include a "password hint" to help remind you of what it is if you misplace or forget it. You, of course, should not enter in your actual password in this field, but a subtle reminder to jog your memory.
After this information is entered, select the Next button. PC Performance

Windows 7 now asks you to enter the product key that was included with your purchase. This key determines what features and which version will be installed on the system. 32 and 64-bit versions have the same product key.

I highly recommend to uncheck "Automatically activate Windows when I'm online". The reason is that you only have a finite amount of times that you may activate online. After this limit is reached, you will need to call Microsoft directly to have them activate your installation. This can be a big hassle, especially when you are in a hurry to get the computer back up and running. Windows 7 will nag you every so often to activate upon logging in, but this is a minor nuisance compared to the phone call method of activating Windows 7. After verifying that everything works as you intend, you can activate and know that you could have avoided problems later on if you let Windows 7 do it right after logging in for the first time.

30 days is the intended grace period before requiring activation with retail versions, even with this method. However, you can boost that number up to 116 days using the following method:

Open up a command prompt with administrator privileges

Type:

slmgr -rearm

After a reboot, you will have an additional 30 days to ensure everything is running properly. You can perform this action up to 3 times with the current Windows 7 retail release, bringing the required activation time to 116 days, if the Software License Manager is invoked at the end of the required activation period (on the 29th day). I would recommend not waiting until the 30th day to run the command, thus 116 days total and not 120.

After this information is entered, select the Next button.

This is where Automatic Updates and problems and reports solutions are offered as an option. I recommend to most users to "Use Recommended Settings" here. These options can always be changed later. Make your selection to continue to the next screen.

Ensure that your time zone is entered correctly and make adjustments as necessary. Also ensure the proper time is set. This information is extracted from the BIOS settings, so if the time was set correctly in a previous installation of Windows (or most any other OS), it should still be correct here. After this information is verified, select the Next button.

Here, you can select the "general" security measures put in place for your particular network. Most people will want to use "Home network" for desktop installations or "Public network" for a portable system, like a laptop. Make your selection to continue to the next screen.

Windows 7 is now connecting to the network. This is where your initial IP address is acquired and internet connectivity is verified.

Windows 7 is finally... finalizing settings. This should only take a few moments to complete.

Not much to say here. Just wait some more.   

Your initial desktop is setup here. This process will take a few moments, but only happen once.

Windows 7 is now finished being installed and are greeted with the desktop. It is worth noting that you did not need to log in this time, but after rebooting (or logging off), you will see the login screen and you must enter the user name and password created earlier to return to this point.