I'm a big fan of moving as many of my applications into virtual machines as I can, especially ones that are rarely used and/or have a significant system overhead.
As a result I have several VMs powered by Virtual Box, and very minimal apps installed on my host OS. One for development, one for multimedia, one for internet.
It's a good setup, only it still has a long way to go before it can be used for games. DX or 3d graphics rendering aside, another problem it has that I haven't found too much discussion on is the audio latency. On Virtual Box it absolutely sucks. In fact there's about a half a second lag between the guest and host OS/s, and we're talking straight Windows XP on Windows XP, no esoteric OSes or drivers in play here. VMWare Workstation nails this quite nicely, and VMware server is only slightly behind (because it has to route all video and audio through a network socket)
Having said that however, it's still an excellent product, and I highly recommend it for anything that isn't realtime. It's much lighter than VMware (both server and workstation. Hell, even VMware player) and its system overhead is very minimal.