I upgraded from XP 32bit to W7x64 around 5 months ago or something. I've only got 3GB of system RAM, but to my knowledge, upgrading to 64bit lets me use a videocard with more video RAM while allowing me to address that 3GB of RAM in full (since memory addressing and its limit applies to both system and video RAM).
I have ran into compatibility issues with software, but I can't really remember the specifics of the few, so I guess it's not that important. It's actually probably more of a W7/XP issue than a 32/64bit issue.
Besides the extra memory, there isn't much else beneficial about it, from experience, since there's hardly any commonly used programs that are written for other x64 performance gains anyway.
The only times I've actually hit my 3GB limit was with Nero and Borderlands.
Both times were due to memory leaks and/or memory hogging bugs.