Hi, Sharon, not sure which PED basic software you are referring to. You have to use the PED Basic to transfer designs from your computer to your machine via a memory card. That's just a card reader. If you want software where you can work with designs, etc., you can use any type of software. Brother has the PE Design Lite and the PE Design (Deluxe). This is actual software to work with your designs. Rather expensive, too.
Does your machine have the USB connection? If so, you can transfer designs from anyone as long as they are in the PES format. I don't have the 400 but do have the 270D and 700II (this one has the USB port).
Go to Brother.com and you can find out which Brother PED Basic version (card reader) is compatible with Windows 7 if that's the way you want to go. I believe there is a free upgrade for Windows 7. The PED Card Reader runs around $100 but if you have a USB port, you can skip that for now. Their site is a little hard to navigate but you'll get there eventually. LOL
FYI, I use Monogram Wizard Plus for lettering and now they have released Monogram Wizard Plus Extended for working with designs. Not too expensive. I also have Sew What Pro and Embroidery Magic 2 for working with designs. Neither is as expensive as the PE Design Lite or PE Design Deluxe.
Hope this helps with your question.
Carolyn