I have been using VMware workstation and VMware player lately. I am really impressed and it is amazing to see the benefits it can bring. For instance one can load a machine running with all the software needed to do web development.
Today I created a virtual machine from an iso file containing Windows 7, which is in beta version right now and will be on sale in october 2009.
I can run Windows 7 as a guest operating system on my Windows Vista operating system, the host.
The virtual machine can have its own IP and be visible in the LAN.