The problem you have here is that Windows 2003, as far as I know, has no built-in virtualization-solution, like Hyper-V in Windows 2008.
Thus you'll have to pick one of the available solutions, like VMWare, VirtualBox or VirtualPC.
I haven't played with VMWare yet, it's supposed to be quite good, but the other two aim have quite an overhead as they use full virtualization.
If you can live with this overhead I'd suggest VirtualBox, as the latest VirtualPC seems to be the 2007-version.
In general I think Windows is not the system for server-virtualization. Hyper-V may be a step in the right direction, but I can only guess there.