I found two websites that give tips on how to get the best performance out of Virtual Server 2005. Check them out:
One of the best tips came from the second article, when discussing SCSI and IDE virtual hard disks:
Still, the rule for performance is pretty simple. Use SCSI-attached VHDs whenever you can and use IDE-attached VHDs whenever you must.
Both pages give excellent tips, and discuss things like the amount of memory you should have, how to optimize VHD placement, number of CPUs, and others. I recommend you look at them if you are considering installing Virtual Server.