They said that the Apple EULAs allow virtualizing Server versions of Mac OS X only. Try it and find out. Maybe try installing it like it you would on a real PC (which is also against the EULA). Those methods usually require the PC to have similar hardware to a Mac though. The Parallels hardware might not be similar enough?
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Hi, What I would like to know is can I installed the full Retail Parallels 5 on top of Parallels 3.0 without wiping out my current Windows XP Virtual Machine...
Parallels Desktop 5 will update old virtual machines from Parallels Desktop 3. http://download.parallels.com/desktop/v5/docs/en/Parallels_Desktop_Users_Guide/29707.htm
A few days ago I upgraded to Snow Leopard, and currently Parallels four can launch and boot to XP, however an extension error reports saying the networking extensions are out of date which networking is disabled.