Well, I think there must be a way around that, I mean to get individual distro. Like you mentoined it's possible with VMW, but I think user-mode-linx
is what I'm looking for since their features
"Trying out new distributions
Its filesystems are contained in files in the underlying filesystem, so any time you want to boot a new distribution, you only need to dedicate a file to it, not an entire disk partition. The project download page has a number of ready-to-go root filesystems loaded with various distributions, including SuSE, Slackware, Debian, and Red Hat."
Another potential use - I don't know of anyone who's doing this. UML provides a fine environment for virtual hosting. Just give each user a virtual machine and the root password, and they can do whatever they want inside it without bothering anyone else."
or am I overseeing something?
However there must be a way to get it working, since diginode is doing so. But maybe they use VMW?