It happened. My laptop died on me and thankfully it wasn't a hardware failure, but my self assurance in knowing everything about the drivers I installed. A few months ago I turned off the Restore feature of XP, gaining a few hundred megabytes via deleted restore points. Well, it was a mistake done once, and it hurt a lot.
I needed to reinstall it completely and it took me two days to tweak everything back. I'm running the divine Windows Server 2003 now.
During the reinstall phase I played with the thought of dumping VMWare 4 and installing the new Microsoft Virtual PC 2004 (I'm currently using 8 VMs, not concurrently). I managed to read through the official newsgroup and found a lot of problems regarding Linux installations, so I decided to give it a little time. Being a Microsoft oriented person, I like to follow the other platform too. When the time comes, I'll change the setup to be run from my main server, and not locally on my laptop. It seems to me, that there are only a few places without internet access around anyhow.