Light heirted humor seems to have a mythical presence too.
There are variations, but I have used Virtual PC (rubbish) and currently use VirtualBox (much better). They are applications that you install on your computer, which you tehn setup a virtual PC with. They will use a virtual hard drive wich will be a file on your mahcine, and you can control other things like the CD drive can be either the actual drive on your machine, or you can make it grab images and stuff. When you run it it runs an application that 'thinks' its a PC, which you can then install stuff on,and run full screen. Basically, it runs Windows 7 (or whatever guest OS you install) as an application ontop of your current (host) OS, But Windows 7 will think its running on a proper PC.
ITs very good for testing as you cant break anything. You alocate it an ammount fo RAM from your machine which it will use exclusively.
Best way to learn, download VirtualBox and install some stuff. Chuck some Linux Distros on there to learn how it all sets up if you want, or just install whatever OS you have lying around. Playing is the best way to learn