Which features and services in Vista can you remove with nLite (or tool of choice) to make a Virtual PC-image of Vista as small as possible?
The VPC must work with development in Visual Studio.
A normal install of Vista today is like 12-14 GB, which is silly when I got it to work with Visual Studio at 4 GB. But with Visual Studio it totals around 8 GB which is a bit heavy to move around in multiple copies.
You can try and cut stuff out with vLite, but unless you cut out a real lot it's not going to save a ton of drive space. Here's your best bets:
Once you have the base machine configured, I would suggest using VMware workstation and the awesome Linked Clones feature, which will let you create a completely new VM based on the base machine, but only using a portion of the space.
I would not advise running a Vista VM from a USB flash drive, it will be slower than dirt.