Why do you use a virtual machine?

Personally, I use it for 2 reasons:

1. Applications that require XP

For example, at the moment I have an XP VM for testing an SSL VPN connection, that does not work on 7, so I can still connect to a corporate network.

2. Server testing

I run a few 2003 servers, for testing server stuff. This works well on Windows Virtual PC (better than VPC2007 did on the the Beta).

Mitchell on Demand 2005 does not work on Win7 correctly... it works, but not 100%..

I have not tried MasterCam X2 yet on Win7, but I hear it does not work, so I am perpared with my XP VM to use it.

well i wanted to try it out but apparantly Sony doesnt want its Vaio customers doing so...

So far, I've used mine for Exchange 2007 Management Tools and the 2003 Server Admin Tools Pack.

Just because I can :)

i will run windows 2008 web server in virtual mode

For me i'm running windows XP with windows 7 in a virtual machine. Its because I didn't know if I would like windows 7 or not so I didn't want to commit my PC to it. This way if something goes wrong it goes wrong inside the virtual PC, it doesn't leave. And if I want to delete 7 I can easily enough. Now that I've used it for a while I'm seriously thinking about going and buying a new machine, likely a cheap laptop to use seven on. Until 7 comes out and is available in a more permanent solution I wont be committing my current machine to 7.

for honeypoting!...:)
that and testing different OS's on it.. (VPC still has a longs ways to go in the matter of features)