Virtual PC isn't a bad program, but it eats CPU power like there's no tomorrow.
But yah, since M$ made that one free, it's quite decent. You can run Windows 95 or 98 on it no problem, which in turn is perfect solution for playing all those oldie Windoze games that don't work on XP at all.
Like Zombie Wars, Warhammer 40 000: Chaos Gate and Mechwarrior 2.
I'm not so sure about running DOS on that, but for that we already have DosBox.
It can both use your real CD and floppy drives as well as load IMG (for floppy disks) and ISO disk images.
Additionally, instead of outright shutting down the emulated machine, you can save its state like in console emulators. Quite useful, IMHO.
Oh, and yes - when you use Virtual PC, you have to install an OS on the virtual machine like on a normal computer. Sure source for a headache at least the first few times...
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