We use VM's in production quite a bit.
It's a great (cheap) solution for those vendor applications that require SA.
Licensing is an issue for those not on enterprise licensing agreements, but I believe a processor license will allow you to run as many vm's with SQL as you want (on that processor). This probably doesn't apply to the OS license... but I'm not a licensing expert.
Anyone have some insight on this?
~BOT
Craig Outcalt