VMWare Player runs VMs but does not create them. Start VMWare Player and click Open a Virtual Machine to start an existing VM. If you have not copied a VM to the system or created a VM on the system you will need to do so.
You can use the virtual software of your choice. On Windows 7 there are many VM solutions avaiable, here are three VM solutions: Windows Virtual PC, VMWare Workstation and Virtual Box. Each have advantages and disadvantages.
One more item to consider is licensing. The OS for the Virtual PC requries its on license. Depending on the version of Windows 7 you _may_ already have a license to run Windows XP in a VM (Professional, Enterprise, Ultimate).
If you are running Windows 7 Professional, Enterprise, or Ultimate and have a system capable of hardware-assisted virtualization then you can use Windows XP Mode. (The hardware assistance may not be a hard requirement anymore.)
Install and use Windows XP Mode in Windows 7
Windows Virtual PC (For Windows 7)