Creating Virtual Server 2005 images

Hello,
I need a walk through on some of the basics of Virtual Server. I have used it before, but I did not have to rely upon it. So, I didn't really care what I did. Now, I am putting a vs in production mode. So, I am asking for a little help in a design.

My goal is to run up to 12 virtual machines at the same time. I have a hefty box capable up to 24GB of ram. So, I am not too concerned about performance except that I don't want to over-create/allocate memory and space to each running virtual machine.

I am confused between virtual hard disks and virtual machines. Do I create one virtual hard disk for all of my virtual computers or should I give each virtual computer its own virtual hard disk?

One of my goals is to have many virtual images for testing so I need to keep the file sizes to a reasonable size.

What is a common and reasonable way to create virtual hard disks for virtual machines?

I hope for a step by step instruction or picture example. I learn better that way as long as my starting point makes sense.

Thanks,
John