Microsoft says that Visual Studio 2008 can be installed on any version of Vista (excluding started edition).
But I am not sure, if Home Editions cause not problems with debugging, virtual machines, IIS, MS SQL 2008 and all other tools which developers use or with some old tools like Visual Basic 6.0.
Seems that Vista Business would be the best, but Home Editions are much more popular.
Or, the would be stay with Windows XP Pro?
If you are deciding for a business you will want Vista Business at least for remote desktop. Vista Enterprise or Ultimate if you are doing mass deployments.
Vista Ultimate if it is your own work station. I say Ultimate because in 3 to 4 years when you buy a new development box, your now 3 year old machine will make a good media center, but you need the features in the business skus as a developer.
Whatever you do, make sure it's x64. Unless you have some random device a manufacturer has abandoned and the only drivers for it are from 2004 and you absolutely need it.
XP is a dog for multi tasking performance in my experience. (the new driver model making vista slow for games... that is something else)
I don't recommend using Server 2008, you will need to add all the client OS features, and not all of them can be added. I also do not recommend using HyperVisor if you like usb devices.
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