The latest VirtualPC from Microsoft does run on Vista, I've used it on my copy of Home Basic.

If you want to go the VMWare route and have access to a XP machine, you can use the VMWare Convertor to make a vitual hard disk image and use it in the VMWare Player.

As mentioned elsewhere though, VirtualBox is a great and free virtulisation software. You might need to download drivers for the virtual Ethernet connection but it is easy to find via google.