This is great news. I run a couple of Virtual PC machines, including Windows 2003 Server Enterprise, Windows Vista, and a couple of Windows XP Pro to test things like Internet Explorer 7 and other software. It is great, but it seems that Virtual Server can have better performance (even better on dual CPU systems) and it supports 64 bit OS too!
Another cool feature I found out today is that the registration keys generated for the software you download from MSDN Universal can also be exported to a XML file - it makes all much easier to administer now.