Is it possible to have Windows running within a Slack terminal window?

Yes. You need to use something like qemu or VMWare

Thank you XavierP! I'll check them both out!

QEMU is an open source effort to create a virtualized hardware platform. VMware is the commercial variant of QEMU, and goes a long way back. This means that VMware performs well, has a lot of tools that help you managing your virtual machines and is quite stable. QEMU on the other hand, is exciting and has an active community of users and coders alike.
I have Slackware packages for QEMU here: http://www.slackware.com/~alien/slackbuilds/qemu/

The ./pkg directory contains packages for the official latest QEMU release (0.8.0) and the accelerator module "kqemu" that you really need if you want acceptable performance of the Guest Operating System (the Guest is what runs inside the Virtual Machine while the Host is the "real" computer that you run QEMU on).
Kqemu is not open source but can be freely used.

The ./experimental/pkg directory contains packages built from the bleeding edge CVS source and patched to run as a VNC server - usually QEMU uses SDL for the graphics and sound output.
The CVS version together with the accompanying kqemu accelerator is really much faster than the release version. You will notice that especially when trying Windows XP as a guest. Windows XP was not really a pleasant experience in previous releases because it felt just too slow and unresponsive.

Eric

Great packages! Do any of them allow you to run a USB pendrive under XP though?

You can always mount the USB pendrive in the Host and then make the mounted filesystem available to the guest as an additional disk.
Adding the parameter would make the mountpoint /mnt/usbdrive available to the QEMU Guest as a D: drive (Windows) of /dev/hdb (Linux). Be aware that the Host OS should not be writing to files there because the Guest would not notice, and file corruption would be the result.

Alternatively, you can allow the guest to actually access the physical USB device by running QEMU with the additional parameter If you want to know more, I've dedicated a part of a Wiki page to my QEMU experiences and USB.

You would need the "experimental" aka CVS packages for good USB support, though.

Eric