For months I've thought about the power of virtual machines. I use them all the time now for production and staging servers and in the past I've used them for QA purposes in a lab. However I have never run a VM instance on my own box.

Recently I purchased a VMWare Workstation 6.5 license on the cheap and on a re-wipe of my laptop decided to put it into use. I now have multiple XP VMs, a Win Server and an OpenSUSE distro. I am now able to have multiple server setup options at my fingertips with ease.

Setup
After several setup attempts I think I have found a great mix.

1. All of my development tools and code are located on my real machine.
2. All of my services are located on a VM
3. All of my services via UNC paths call on files from the HOST machine.
   • This allows me to have multiple servers from multiple VMs reference [easily] the same code set.

Things To Pay Attention To

1. Setting up the networking can be difficult the first time, but it really is easy. I choose to run everything in NAT mode; just make sure your firewall settings are all correct. I've also made all of my Windows machines part of the same workgroup to make some file browsing easier.
2. Permissions: In my case I created a VMUser in my VMs that was an admin/root and on my main box created that same user. I made sure VMUser had read/write too all of the relevant files. I then made sure all of my services were running as that user.
3. Flex / Flash Development and Debugging: Because you will be launching your debugging on an IP such as 192.168.248.x instead of 127.0.0.1 your Flex Builder will be unable to attache to the debug tool from the browser. When you launch your flash/flex app right click on the flash app area. When you click you will see a menu item "Debugger"; click it. You will get the following pop-up. When you do change the selected option from localhost to other machine and enter 127.0.0.1. Viola, your debugger will now attache!
   
   

So far my experience is extremly positive. I recomend a minimum of 4 gigs; this is what I currently have and I would want no less. My next laptop will definetly have either 6 or 8 gigs to allow me to run multiples at the same time, or maybe even make a VM my full time editing area. VMs can do multi-monitor BTW! I would love to have my base OS be basically naked and be able to more easily do snapshots and go backwards in time. For me, setting up all the servers takes the most time. Now I can just backup my VMs and on a future wipe of my box, literally be up and running in say an hour instead of 5 or 6.