Project Server 2007 is a major release that involves fundamental architectural changes. It is vital that you plan the migration carefully and meticulously - and we have a migration guide in Beta1 (and are planning on an updated one in Beta2) that would help you with that. We strongly encourage you to migrate your Project Server 2003 with the beta version for the migration utility and report issues if you have any.
Upgrade versus Migration
Upgrade is about changing your data in place (i.e. you have Project Server 2003, run upgrade and then you have Project Server 2007) and you can't go back to Project Server 2003. Migration is about taking data from Project Server 2003, fixing things up and then saving it to Project Server 2007. At the end of migration, you will have Project Server 2003 and Project Server 2007. Project Server 2003 to Project Server 2007 is a MIGRATION process, not UPGRADE!
Some more FAQs:
Q: Is cross language migration supported? That is, could I migrate from Project Server 2003 English to Project Server 2007 French?
A: Cross language migration is not supported. We only support migrating across the same language. But after migration, appropriate language packs may be applied on Project Server 2007 to get a similar effect.
Q: Can we consolidate data from multiple Project Server 2003 instances into one Project Server 2007 instance? That is, can I consolidate http://2003PWA/Dept1 and http://2003PWA/Dept2 into a single http://2007PWA/Single?
A: No, you can't do this as part of Project 2007 migration. If you have 2 Project Server 2003 instances, say http://2003PWA/Dept1 and http://2003PWA/Dept2, you need to migrate them to two separate Project Server 2007 instances (i.e. http://2007PWA/Dept1 and http://2007PWA/Dept2).
Q: I migrated a subset of projects to Project Server 2007. If there are users who are on Project Server 2003 projects AND Project Server 2007 projects, how do I manage Resource availability?
A: There is no easy answer to this. In the period when you are operating 2 servers - you won't get an updated resource availability view in either Project Server 2003 or Project Server 2007. So, we recommend that you don't have Project in a side-by-side state for an extended period of time. Alternatively you could build a custom solution that gets resource availability from the two systems and presents a unified view.
Q: Will "linked projects" and "master projects" get migrated?
A: Yes, they will be migrated.
Q: I have Project Server authenticated users in Project Server 2003. After migration, I find no way to login as those users. Did they get migrated?
A: Yes, they got migrated. But you need to setup forms authentication for Project Server 2007 to enable their login (Project Server 2007 relies on the SharePoint/ASP.NET forms authentication infrastructure).