This might be somewhat of an over-simplification, but I've just been having a bit of fun finding this out the hard way so I thought I'd post a couple of the more useful links I found - eventually :(

So in short, it looks like a two-machine setup for me, as I don't really want to mess about with VMs having spent far too much time on this already...

UPDATE: Unless, of course, it's the Feb CTP, which seems fine (both use v2.0.50110 of the framework).