VMware Workstation 7 has added support for Windows 7 and expanded the ability to handle virtual processors. The new version of Workstation supports the 32-bit and 64-bit versions of Windows 7.
It you’re still running VMWare Workstation 6.5, a windows 7 VM can still be created. Just take note that the windows 7 iso image will simply be recognized as Windows Vista when you’re creating the VM.
For VMWare Workstation users who have been complaining about the fact that Aero is not supported for Vista or Win7 guests OS, you’ll now be happy to know that Aero in Vista/7 guests are now supported in VMWare Workstation 7.
Meanwhile, I’ve checked Virtualbox (Sun’s open source virtualization software) and it’s also mentioned that Windows 7 is supported.
Details of VMWare Workstation can be found here.