Using Windows 7 XP mode to do development

"Yes it is reliable enough (well about as much as you trust MS), a colleague runs the same setup for a VS 2003 and 2005 project, development works great.

XP Mode is basically a Microsoft Virtual PC pre-installed with XP SP3, bundled and configured with Windows 7. So yes you should be able to connect to your XP mode SQL Server from the host, as the VPC allows host-guest networking."

"Assuming you have the appropriate hardware, this should work just fine. XP Mode can either run the applications seemlessly and look like native Win7 applications, or you can open the VirtualPC image directly and interact with them in their native environment.

One of the great uses of XP mode is to be able to side-by-side install applications that otherwise wouldn't co-exist on a system. This is a great use of that ability."