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Microsoft HyperV or Vmware ESX Server???

I am going to buy a new server on which I want to host my SharePoint, SQL and Domain Controller as individual virtualized servers and I'm looking for some advice.

I have used Vmware server, workstation and fusion extensively and very much like the product.  Their ESX product looks fantastic, but it's expensive.

I've also heard about Windows Server 2008 with Hyper V which is supposedly MSFT's virtualization product.

Essentially what I want is:

*The ability to virtualize all my servers so they can be migrated to new physical hardware in the future with minmal fuss
*The ability to plug-in or add (cluster?) additional physical hardware (to provide more "grunt" to the virtualized servers) without hassle
*Low cost
*Excellent stability

I would appreciate impartial advice or reccomendations you could give me on

2 Solutions
ESX is a great product.  Depending on the features you need, the FREE ESXi product may fit the bill for you.  It is then scalable to add the "grunt" as you call it.  
Hyper-V is no where near vmware right now in terms of being able to run virtual servers in an enterprise production environment.".

You are comparing a tested and proven, and very mature, product (VMware ESX) with a brand new product, Microsoft Hyper-V).  Where VMware has a full suite of management components available, not only from VMware but from third party ISV's as well, Hyper-V has very little of this today.  

Will Hyper-V get there eventually?  I suspect that it will in a few years. Microsoft has seen the light when it comes to virtualization, and is pulling out all the stops.  Having said that, VMware is by no means standing still. They have been doing virtualization for something like eight years, and have fairly deep pockets.  
The development cycle of a company like VMware is much shorter than Microsoft's cycle.  
Not only is VMware running many tens of thousands of production servers, those servers are running high end finance, Oracle, Exchange, and many other truly mision critical apps.  Also, for the moment VMware supports more OS's in VM's, and offers much better performance than Hyper-V.  You will run many more VM's on ESX than you will on Hyper-V, given the same host hardware configuration.

For my money, I'd stick with VMware for the forseeable future.  You already have the initial investment made, you have the knowledge, and you are up and running.  Stick with a winner!

On the other hand, for someone that is dabbling a little, or only wants to virtualize some basic servers, perhaps some development boxes... Hyper-V will likely work fine - as long as the high availability features are not needed.
Low cost depends on how you measure it.  If you are speaking only of licensing costs, sure, Hyper-V is cheap, then again, ESXi is a better product, and is also free.  On the other hand, when you start looking at how many VM's you can scale to on a single host, with a given amount of RAM, ESX is clearly the winner.  If you need the robust features to ensure that your VM's are always up and running,  Hyper-V does not yet have the tools.  Someday (?) they will, but not today!
bereanbs has a strong argument here, and I'm with him on this. I won't reiterate what he talked about here because he's hit on key points, but I will mention additional considerations when working on a virtualization project.

For your new server, your vendor of choice (Dell, HP, etc) should have an option to embed the hypervisor on the motherboard for you, so that all you have to do is boot and configure your ESX server. Keep in mind that when you spec out your server, to provision it with enough resources (CPU, RAM, HDD, NIC) for the VMs you're going to run if you're going to have a successful VM deployment.

Depending on your High Availability, Business Continuity, and Disaster Recovery requirements will determine which licensing scheme will work for you. As bereanbs suggested, you can deploy these VMs into production quickly by using VMware's ESXi or ESX 3.5 at no cost and then build a business case for bringing in an acceleration kit (that includes VirtualCenter, HA, DRS, VMotion, etc) later to address those HA, BC, and DR needs .  

If you're building your own server see the following for compatibility

If you're server did not come with an embedded version of ESX, then you can also do your own (see http://www.kjctech.net/blog/archive/2008/10/24/boot-vmware-esxi-from-a-usb-flash-drive.aspx for more info)

Deploying VMs means that you'll need to also consider backing them up in case of failure. Look to 3rd party vendors like EsXpress, Vizioncore, etc to provide you with that (or your backup vendor for a plugin or agent to enable this process).

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