Update: The post is updated accordingly with the Server 2008 R2 build 7000 commands, and information on how to create/add/attach VHDs using Disk Management.
Windows 7 and Server 2008 R2 supports booting directly from a VHD file, the same kind of files used for Virtual PC/Server and Hyper-V.
This gives you the option to install and handle the installation directly in one simple file, while being able to boot and run the OS just as if it were installed in a regular harddisk.
Also you should be able to attach these installation to the above products, and boot the installation. I'm just guessing here, i have not tried that yet but i'll have a go at it.
First you need to create a VHD file. This is done using diskpart, and then afterwards you can handle the boot process using bcdedit. The following shows the commands used in the 2008 R2 (build 7000), and the Windows 7 Beta 1 (build 7000).
If you have Windows 7 installed, boot into the OS and create the VHD file
diskpart
create vdisk file=c:\vhd\win7.vhd type=fixed maximum=16000
This will create a 16GB VHD file in C:\VHD (C:\VHD\ needs to exists prior to running the command)
VHD files can also be managed using a GUI directly from the Disk Management tool. “Computer Management” and right click “Disk Management”. You should see the following options:
After you have created the disk file, boot your machine with the Windows 7 DVD in the drive, and choose "Install Now". Press SHIFT+F10 to get a CMD prompt. You can also choose "Repair" and start the CMD from the tools menu. Run the following to select and attach the VHD file.
diskpart
select vdisk file=c:\vhd\win7.vhd
attach vdisk
NOTE: The command for "surfacing" (crazy name if you ask me...) a VHD files has changed in the 7000 build, and is now called "attach vdisk" instead of "surface vdisk".
If you are running the above commands when installing 2008 R2 Build 6801 the command is "surface vdisk". My guess is that this will also change in comming 2008 R2 builds to attach instead. The new beta 1 release of Server 2008 R2 (Build 7000) now also uses the “attach” command instead of surface.
After you have attached (Or surfaced the disk...) just type exit 2 times, and you will be back with the installation. When you come to the part where you choose where to install, you should see a 16GB partition. The installation will tell you that you cannot boot off this volume, just ignore and select the drive and install.
Since Windows 7 supports VHD files, it also knows when it is being installed to a VHD file. Therefore you do not need to add boot entries manually, the installation process takes care of that itself. The bad thing about this is that it makes your VHD installation the default boot option, and the entry name is "Windows 7" - just as it is for a "normal" installation.
Fear not - this can be changed using bcdedit.
When you have booted either the HDD or VHD installation, start a CMD prompt and run bcdedit with the verbose (this will show you identifier as GUID, which i find easier)
bcdedit /v
copy the ID for your VHD installation and type: (change xxxxx... to your GUID)
bcdedit /set {xxxxxxxx-xxxx-xxxx-xxxx-xxxxxxxxxxxx} description "Windows 7 VHD"
The above changes the description for your VHD installation to "Windows 7 VHD" so you can distingues them.
bcdedit /displayorder {xxxxxxxx-xxxx-xxxx-xxxx-xxxxxxxxxxxx} /addlast
This adds the VHD installation as the last choice in the boot list. If you have multiple entries, jyst type them in your prefered order seperated by spaces, and drop the /addlast option.
If you want to add an entry for a VHD installation manually, the easiest way is to just copy an entry in the boot store
bcdedit /copy {GUID} /d "my copy"
Afterwards you can change the 2 following options to point to your VHD file:
bcdedit /set {GUID} device vhd=[C:]\vhd\win7.vhd
bcdedit /set {GUID} osdevice vhd=[C:]\vhd\win7.vhd
Thats it! Im running 2x 2008 R2 and 2x Windows 7 installation on my laptop using the above, and it works like a charm.
You can also use the diskpart command for attaching your VHD files. This way you can copy files, change settings and so on to the installation in the VHD file. Just use the select + attach/surface command. Remember you cannot attach an running VHD file.