Microsoft have reacted to the free version of VMware Server by making Virtual Server 2005 R2 free. That's really good, but one change that is really cool is that Windows XP Professional (including the x64 edition) have been added as host operating systems. (Although note the warning in the release notes: "You should use Microsoft Windows XP Professional as a host operating system only in a non-production environment". This might be due to networking limitations built into XP to distinguish it from the Server version.)
Download Virtual Server 2005 R2 here (registration required).