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I heavily use virtualization both at work and home. I originally had an ESXi 3.5 server at home but my RAID controller was an Areca ARC-1170 which is not on the VMWare Hardware Compatibility Guide so after reviewing the off-the-shelf community help I learned how to roll my own oem.tgz to include the drivers. The system worked for a while but I then started to experience a lot of stability issues so I switch to KVM running on Fedora.

Unfortunately KVM on Fedora has had a lot of issues with the virt-manager being stable. Right now I'm on Fedora 13 and every time I open the console on virt-manager for a specific VM it causes X to crash and reload. If I boot the VM up from scratch with the console open it's less buggy. I actually had this problem originally on Fedora 11 and am still experiencing it with 13 even from a fresh reload. Fortunately it's not really an issue for me because I can just ssh or use XMing to send my X related apps.

The biggest issue with virtualization is that host memory is your most precious resource. To solve this problem, OS drivers can be installed to support memory ballooning. What memory ballooning does is make sure the guest OS frees up memory resources it is not using to the host. If you're running a lot of Microsoft Windows I definitely recommend ESXi since there are no good memory ballooning drivers available in KVM or Xen and really no roadmap for it. If you're running a lot of Linux I highly recommend KVM since current distros already have the kernel features that make memory more efficient. In fact, it is advantageous to run a homogenous distribution (i.e. all distro-X version Y) because the latest kernels have memory deduplication which will cause memory pages that are the same to be only stored once.

http://www.vm-help.com//esx40i/esx40_whitebox_HCL.php

Here is a compatibility list for ESXi. If you pull it off then add a second machine and build yourself an ESXi cluster ;). You need to pay attention to the SATA controller.
http://www.vm-help.com/esx/esx3.5/Whiteboxes_SATA_Controllers_for_ESX_3.5_3i.htm This way you are not only getting experience with your line of work applications but also with the VM software most datacenters use. VMWare Server/MS Virtual Server are nice alternatives when you don't have ESX/ESXi compatible hardware, but eat much more HW resources and ESXi takes just 3 minutes to install and you don't have to patch the operating system every other week :).

A while back I ran across these little boxes. They were being phased out, and were on sale. I bought one, and found that VMware ESXi works great on the... so I got 5 more ;)

I set them up with ESXi, and put 5 1TB drives in a midtower case running Linux with 3 GigE NICs, and setup NFS shares and iSCSI targets (just to play around). Bond the NICs and have ESX use it for datastores... all for $3,600.

Tada! Instant "blade" environment w/SAN! Sure, the performance isn't quite the same, but for proving out concepts and experimenting, it's awesome. And ESX is fun to play with compared to plain old Server (1 or 2). Not to be biased, but VMware is by far the most well stocked, feature wise, virtualization solution out there. I've personally used it since pre-1.0 back in 1999-2000.

I'm mentioning this since you mentioned VMware, and I thing someone above me mentioned it as well, but it's a important point; VMware ESXi is by far more picky about hardware than Linux. If you want to play with it at some point, make sure whatever you buy will work with it. Check out vm-help.com, which gives you more hardware compatibility insight than VMware's documentation.

Have fun!

Hello for a non official list of unsupported hardware confirmed to run both ESX and ESXi please see the following site.

http://www.vm-help.com/esx/esx3.5/Whiteboxes_SATA_Controllers_for_ESX_3.5_3i.htm

The site is run by Dave Mishchenko who is quite knowledgeable on VMware

Tested this on a Dell Power edge sc1425 (1U) with 1 Sata disk, and it installed with no hassle. It seems that the new Vi-client has some nice extra options compared to the older 2.0.x like plug ins, that can be added for support directly from you hardware vendor.
Say you want the HP insight manager plug in, to view health status on your server directly in your Vi-client, how neat is that!?

We have been running regular Esx since 2.5 and are going to upgrade to 3.5.2 (from 3.0.2) this Thursday, morning. Just wonder if it would be worth getting this on instead, then we could avoid renewing out support plan next year.
Since we aren't running on a San or any other centralized storage solution, we aren't using the enterprise tools, but just 4 DL385 boxes as stand alone.
There is a Cli (command line interface) for the i version, but if you need normal ssh into your box, use this guide: http://www.vm-help.com/esx/esx3i/ESXi_enable_SSH.php

This is really a brilliant move from vmware imho.

ESX or ESXi works just fine with a bunch of plain old IDE and SATA controllers...see here for more information.

You can't put virtual machines on an IDE drive, but you can put them on SATA disks with the controllers listed at that link. You don't get RAID on any of them, though, even if they have some sort of RAID available. ESX(i) only officially supports storing VMs on RAID arrays if the disks appear to be SCSI of some sort (including SAS, or SATA on an SAS-capable controller).

You could also use Openfiler to create iSCSI targets that ESXi can use to store VMs, and Openfiler can use any storage that any modern Linux can use, including Linux software RAID. This allows you to have a VMware ESX(i) setup permanently (ESX was available as a free 90-day trial) on some pretty cheap hardware.