Fret not, this is not the longest product name in Microsoft history. This is a very useful product and I use it on my main development machine so that I can have multiple development environments for all of my many different projects. I would highly recommend this over VirtualPC 2007.
The service pack adds so many new features it really should be called Microsoft Virtual Server 2005 R3. You can now use this natively on a 64-bit OS and it also makes use of hardware virtualization. You can cluster these, but I’ve never tried that, and you can use VSS (shadow copy not source safe) to backup running VM’s.
Check it out here.
Oh, and it’s enterprise class software for free! Maybe now that they are finally done with it they will kick Windows Server Virtualization into high gear. I just wish I didn’t have to wait until the end of the year to get a beta of that. WSV will allow 64-bit guests. VS2005R2SP1 will only allow 64-bit hosts.