I have been using VM's for years now - MS ActionPack is a good alternative to full MSDN for this. I do a lot of Visual Studio development and have tended to have a VM per Visual Studio version so when you have to go back to some old code to make mods you don't have to risk upgrading projects etc for small changes - I have VM's all the way back to VS6 and what is nice is I don't have to fire them up except when needed and they migrate on with my main VM host box each time that gets upgraded.

I use VMWare WorkStation and a good tip is to aim the suspend file at an SSD - then the VM suspends and resumes super fast so you can shut down and reopen VM's dedicated to specific tasks without too much delay