I just noticed KB 842301 “BizTalk 2006 and BizTalk 2004 supportability on a virtual machine“. 

BizTalk Server is fully supported when installed in a virtual machine (VM) running on Virtual Server. A snippet from the KB is below:

Microsoft BizTalk Server 2006 and BizTalk Server 2004 are fully supported when they are installed on a supported operating system that is running on Microsoft Virtual Server 2005. Neither BizTalk Server 2006 nor BizTalk Server 2004 may perform as expected if you have installed it on a supported operating system that is running on a virtual machine (VM) other than Virtual Server 2005. BizTalk Server 2006 and BizTalk Server 2004 have not been tested on operating systems that are running on VMs other than Virtual Server 2005.Product support for BizTalk Server 2006 and for BizTalk Server 2004 on a VM other than Virtual Server 2005 is provided as commercially reasonable support. Commercially reasonable support is defined as all reasonable support efforts by Microsoft Customer Support Services that do not require BizTalk Server 2006 or BizTalk Server 2004 code fixes.

If you experience a problem in BizTalk Server 2006 or in BizTalk Server 2004 on a VM other than Virtual Server 2005, and the problem cannot be resolved through commercially reasonable support, the problem must be reproducible in a non-VM environment or on Virtual Server 2005 for the problem to be escalated to the BizTalk Server Product group as a bug.

It’s great to see [more] Virtualization commitment from Microsoft, and formally supporting their software in VMs.  Sure there is a long way to go, but any torrential downpour has to start with a drop of water :)