Hey - sorry ive been out of pocket lately, we are working on an R2 release for Server 2008, and ive been working with our larger corporate customers getting med-v, and hyper-v components mainstreamed for them.
So how do you folks like Win7 So far? Please remember that this is a release candidate, and the enhanced XP Compatibility Mode feature, is designed around our corporate customer base, and support is "very" limited. The premise around it using the Intel Virtualization-T, is that it allows the virtualization technology (a loose hypervisor) to make direct calls to the CPU/Memory/HW Layer, ruling out processing through the operating system.
I would probably be shot for saying this outside of here, but if you are looking for more of an enhanced compatibility experience, I use VMware Workstation at home, with the Unity Portion of 6.5.1. which gives you the seamless application window, and does not require intel virtualization technology on your processor. The only Caveat is you lose a little bit of performance to processing functions through the VMHostKernel Process and vmxnet, also you obviously will need more memory to support the virtual machines operations.
As far as the defrag piece goes.. We build alot of lazy functionality into it... I recommend that you turn off te automatic defrag piece, as you will get some undesired results (aka defrag kicking off when you are in the middle of a game, etc) also if you are comfortable with your troubleshooting skills, turn off System Restore.
All in all we are shooting to make this a really good OS release, and I appreciate your feedback.