I'm probably dreaming, but I have a hobby project in mind that I would like feed back on.

I have an opportunity to purchase a 3 year old fully populated (14 x 3Ghz dual Xeon nodes) IBM bladecenter relatively inexpensively.

I thought it would be fun to set it up as a beowulf cluster with open source xen and test the market to see what people would pay for Private virtual machines.

My thoughts are to use 64 bit Centos 5 as a base to get the beowulf cluster up and then load xen.

I haven't really looked at the market but I figure I should be able to run 50 private virtual machines charging say $50 per month. I figure I can use rsync to backup the virtual machines to a different location. I plan to connect to linux based Network Storage running 3 x sata 1TB drives, probably via iSCSI. Along with the drive capacity currently on the blades I should get 2-3Tb online capacity over a Gbit network. (Cisco 14 + 4 network switch module)

I realise I have a bit of setup work to do and before I go investing a lot of time and a little money I'd appreciate some pragmatic advice as to why this may be a stupid venture.

What about this?

have you found the way to build the beowulf cluster?
i would love to hear if any had been successfull in building the cluster and run virtual servers on it.
currently reading and planning to implement this: http://www.asplund.nu/xencluster/xen-cluster-howto.html
hmm, visited it and browse about it, and found that they probably use single high performance server to create farm of virtual machines
http://www.vr.org/technology/technology-overview/