I think I haven't been clear or maybe my original post was too long and this got lost in it.

We are not looking into this because we want to virtualize our server. We need a second hyper-v server and with the economy being what it has been for 2 years we'd rather not spend 8000$ on it........at least not right now.

Since our actual physical SQL Server is quite powerful, it can be turned into a Hyper-V server but if we do that I need to move that SQL server somewhere and I'd rather no run it alongside anything else which is why we're looking into virtualizing it.

I'm not really worried about CPU and memory, I am really much more concerned about physical disk I/O and whether I should virtualize the disks or give the VM direct access to the disks (physical i/o path).

One thing I feel needs to be closely looked at is the possibility of a power failure. If, for any reason, our UPS doesn't do its job and doesn't properly shutdown the server there's a risk of damaging the transaction log and end up being unable to restart the database which would for me to restore the most current backup.