One of the fun things is that the dynamic memory feature is enabled through the integration components, enabling it not only for Server 2008, but also for Server 2003. another thing is that it is not the usages that is ballooning, it is the actual memory the OS sees that is expanding. The machine itself sees the amount of physical memory grow:
the picture is of the alexandria virtual machine configured in my previous post. it starts with 128 MB of Memory and is allowed to expand to 256 MB. (I Know, I am very generous to my virtuals) As you can see in the image the memory usages grew up to 120 MB, so it reserved more memory to facilitate this memory usage without the need to page to disk.
I’ll keep you posted for more.