Michael,
if you have a good PC in terms of memory, you can use virtual machines.
I use VMWare Workstation and it is perfect for the usage you described. But it is not free. The Player is free but you need your virtual machine already setup.
I suppose you can use Microsoft Virtual PC 2007. It is free and should work fine with Linux too.
Other virtualization software that I've not tested: VirtualBox, Parallels.
Ciao
Eros
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