1. I would match the sizes.
2. Generally speaking, a new vinyl window cannot be placed inside of an existing vinyl window. You'll need to rip that one out, then build a buck frame to the size of the new window.
3.That upper sash is probably part of the extrusion and will not move. Again, the whole frame will need to come out.

Hope that helps. :)

Thanks for the advice.

The windows I have are horizontal sliding windows. Is there a specific reason why I can't put a new vinyl replacement window inside of an existing vinyl window?

If I can't do that can I just grab my saw and cut out the vinyl frame and screw the replacement window into the frame?

I have never seen it personally done like that but it is tough to visualize your scenario without seeing a picture.

Normally, you would cut out the old sash and frame and install directly to the drywall, old wood buck of the previous window, or rough opening.

tonton, the reason is that most vinyl windows are designed to fit inside the "pocket" of a full framed wood window. They cannot accept another window of the same size. Any attempt to attach a smaller vinyl window into an original one will be disastrous. The only exception would be a full framed wood unit that just has vinyl cladding on the exterior. By your description, you have a full vinyl single-hung, and it just cannot be done.

This is very bad news indeed. I am not sure what I should do with the existing vinyl window; it will not match the replacement windows I would like to use for rest of the home (Milgard Tuscany windows). I guess ripping the vinyl window out and build a buck frame to match the net frame opening of the other matching window is the way to go...

Now you are sounding like an expert! :D

+1

That is the way to go in this case.