I have a dream to go to Vienna during Christmas time, but most likely it would be December 26th (as I am a teacher and my holidays usually have more days after Christmas). I am reading that most of the markets close on Christmas Eve. What about Salzburg? Is Vienna as magical at this time of year as I think? or is it better the week before and actually on the 24th/25th?

The Schonbrunn palace Market is traditionally open on the 25th and 26th ?
Others will clos on the 24th usually.Some say this perhaps to change due to tourist demand .
Vienna is beat the week before Christmas. Immediately afterwards, preparations begin for the massive New Years celebraion.
On e place to investigate is the lake District east of salzburg.
I believe the small towns of St. Gilgen, Strobl, St. Wolfgang and Mondsee keep their markets open until New Years .
This area is very beautifiul for sightseeing - the towns vry nice and less than 1 hour by public transport form Salzburg -

The 24th Christmas Eve is the major celebration time for this Holiday in Austria. All things begin to close early in the afternoon allowing families to gather to have their festivities and traditional evening meal.
The 25th shops are closed , most tourists sites open- time for local family visits , walks etc.

We were in Austria/Germany for Christmas 2008.

Surprisingly that year, the Salzburg Christmas market was opened until 3:00pm on Christmas Eve, then again for a few hours (I think 11:00-18:00) on Christmas Day and on the 26th. The Innsbruck market was still opened on the 27th.

I believe the Vienna market opens only up to the 24th.