Simple answer depends on the version of VM software used.
VMware Desktop/Workstation --NO
VMWare ESX server -- Yes
What you need is a PC with a seperate HBA for storage. Connect some drives to the second HBA and then ESX will allow you to create shared storage between 2 virtual machines (which is what you need for clustering).
However, ESX is...
Expensive
Runs as the OS for the PC, as opposed to being an application that runs on top of an OS.
Otherwise, your only way of doing this is to have 2 physical machines each with a SCSI card, and a SCSI HDD with a SCSI Y cable (that allows 2 hosts to connect to the same HDD.
Also bear in mind, Windows 2003 Server only supports clustering on Enterprise version which again is a lot of money.
My experience was using ESX V2 on a Dell 1U server with attached RAID.
I setup Windows 2000 Server as an Active/Passive Cluster running Exchange 2000 in failover mode.
It worked very nicely, but there are better/cheaper products out there now for failover of Windows/Exchange.
Neverfail (I think) is one that I have heard of but have never played with.
Let me know if you want any more information.
Thanks
Elliott