Because virtual machines are essentially big files, you will benefit if the disks they are stored on are fast. So, if you stripe a couple SATA or SAS drives, this should really help speed things up. Enterprise users will obviously have access to better firepower (RAID 1+0, RAID 5, etc), but I'm framing this in the context of the tech dabbler just getting his feet wet with the technology.
I bring this issue up because I put an old, circa 1999 20GB spare drive in my XP workstation and used that drive as the conversion destination of my local XP Professional Workstation to vm. After the conversion, which was successful, I started the vm and the performance was horrible! It was almost like the vm hung or was frozen. In truth, the vm was just extremely slow because the IDE drive was circa 1999 and had little buffer for the 8GB+ vm. I didn't immediately know what was happening, so I used XP's Performance Monitor to view average disk queue length.
Average disk queue length is a rough measure of disk performance, but it is a useful gauge of i/o problems. For me, I find that values of over 20 indicate performance issues. Your mileage may vary.
One note: if you don't like the default scale of 100:1 on the Performance Monitor chart, you can change that default scale by:
1) right-clicking on the statistic in the legend of the chart
2) select Properties
3) click the Data tab
4) choose another scale under the Default Scale dropdown menu
UPDATE 7/6/2007: I've expanded my discussion of performance monitoring VMware Server here:
Also, I noticed my performance seems to suffer if you use the "Split Disk Into 2GB files" option. As well, I selected "Allocate all disk space now" for better performance.
In regards to this option, I found a bug in the VMware Converter gui. When I initially went to configure the conversion of the local machine, I was not able to deselect the "Split disk into 2GB files" option for the destination drive (a second local hard disk) that I wanted to use.
The checkbox was greyed out and unselectable. Trying to fix the problem, I returned to the destination dialog box, changed my destination drive to a network share and the option suddenly became available. On a hunch, I then went back to the destination location window, changed the destination drive to the original local drive and the "Split disk into 2GB files" option was now available.
I don't know why the option was made unavailable at first, but I was glad to be able to route around the error.