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SQL licensing options

Hi,

I'm looking into making an SQL lic purchase.  
We already own a 2 proc sql lic for sql 2008 Std R2
We are thinking of buying an enterprise Lic for sql 2008 R2

I understand the products are downgradable  to 2008 standard (R1), and, that  would do us fine for anything we need to do here.

Would we be in compliance if we had 8 or 10  SQLStandard instances running in VMs on the same 2 processor ESX box?  If not what would be our best bet without breaking the bank.  I've been through the licensing docs quite a few time and am thoroughly confused.

I attached one of the docs , "2008 SQL licensing overview final"

 2008-SQL-Licensin-overview-final.docx
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Does the enterprise version require the "input of CALs" to make connections?  In other words is there a hard stop when a the licenced number of CALs are reached?
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Server/ Cal is the the purchase we are considering
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If I downgrade to plain 2008 ent (not R2) then don't I have unlimited virtualization rights?  I'm getting this from the VIRTUALIZATION AND MULTI-INSTANCING section in the doc
"SQL Server 2008 Pricing and Licensing"
http://download.microsoft.com/download/1/e/6/1e68f92c-f334-4517-b610-e4dee946ef91/2008%20SQL%20Licensing%20overview%20final.docx

About Server/ CAL licensing, it says, "For Enterprise edition, for each server to which you assign a software license, you may run, at any one time, any number of instances of the server software in one physical and any number of virtual operating system environments on that server. "
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Your comments and those of a ms sales rep confirm ms lic is as clear as mud
In some case we are just making best guesses