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Which requires the least total storage to run Windows 7, configuring an MBA for dual-boot with Bootcamp, or using a VM (Parallels, VMWare, VirtualBox)?

For the smallest solution, how many free GB would be required for a standard minimal system Windows 7 install? (such as just for testing web pages on MSIE, and such.)

Can a VM boot and run Windows off of a USB connected HD or SSD well enough to be "usable"?

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Using a virtual disk in VMware you can avoid dedicating space to Windows 7 that is just free space, unlike a dual-boot where you'd have to allocate a partition that has all the free space you will ever need. (Probably true with other VM solutions, but I don't know.) While a VMware virtual disk does not auto-shrink, it starts out small (on the host disk) and only grows as needed. So that would be the smallest storage solution.

I would not expect USB 2.0 to perform well enough to run a Windows VM off of it, but I never tried. Firewire would be OK.

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I'll add to this that the VM solution could grow in disk space beyond the dual boot solution if you use snapshots liberally. My Fusion VMs run great off the internal HDD in my MBPro (which uses an SSD for the OS X OS). –  Ian C. May 15 '12 at 21:29
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