dr.zli: VMware player is cool, thing that bothers me is that sometimes it's download page is unavailable and that tends to annoy ordinary users. Also,with ms, it's mostly next, next, next, yes and you've got a VM, no such thing with vmware. I'm in retail business and I have to look at things from end user's point of view, ms is better in that department.
As for the 3d acceleration - but of course! It's designed to help businesses use legacy apps and make their transition to windows 7 (or x64 win7) enviroment easier, the correct path for any user would be to try installing and running a game in compatibility mode and if all else fails, try xp mode. Thing is, I still manage to run all my old games either by using dosbox, scummvm or natively in win7, I had to use xp mode only for certain apps that are VERY old.
Reason I'm constantly yammering about xp mode is because people either don't know they can run it or don't know about it and it's a nice addition to your tools if you run win 7 pro or ultimate.
For the win 7 home premium crowd, go the vmware player way, it's also free and has pretty sleek interface, you'll love it. ;)
You can use the "XP Mode" (really just a Windows XP .VHD) with Vmware Player.
Also Vmware Workstation has an excellent feature included in the GUI to easily install other OS's for you. MUCH easier than other VM software.
Most VPC users preferr VPC 2007 or earlier for DOS/9x compatibility (if they are gamers). You don't see too many of those people using Virtual PC for Windows 7.
For 2000+ it's either Vmware or VirtualBox (I use Vmware myself...every year I'll try out virtualbox but it disappoints me every time). Vmware Workstation is well worth the money and has been for quite awhile.
Kabuto: The average person won't be spending $189 just to use VMWare workstation for a few games.
cogadh: You're right, they'd just use the free VMWare Player (that's what I do). It works great.
EDIT - double ninja'd!
dr.zli: interesting topic, ms went to great lengths to integrate that particular way of virtualization as much as they could with OS so that it runs almost unseen in the background. Therefore although it uses virtual image and ms's VM it's not a classical virtual machine like ms's VM with linux (or vmware with linux ;) ). Try it out, works like a charm :D
cogadh: One problem: XP Mode does not support graphics hardware acceleration, it won't work for pretty much any game from the DirectX era (unless the game has a software rendering mode, of course).
D3D not DirectX. DirectX works fine in all VM's assuming Windows 95+ works in them. :)