I have installed VMWare onto SME V7.2 as instructed in the WIKI, then installed XP Pro and SQLExpress and setup an MSSQL application.
All seemed to work reliably although performance was a bit down. Having said that, I havent done anything about tweaking anything for performance. At certain times of SME updates, the VMWare needed to be reactivated. That is a simple enough task, just annoying to have to keep doing.
I dont have it in production and my work was only exploratory in so far I a need an option for a possible future server upgrade.
I am interested in other users experiences or progressions beyond where I left off. In my part of the world, I am seeing a number of developers embracing SQLExpress (YUK) because it is a freebie (so far) and I think we will see more and more applications requiring this.