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Can I install an OS and VS on the external drive?

I have a laptop with XP Home on it and Visual Studio .NET; I also have an external hard drive. I saw that in previous question that the person wanted to put VS on a different drive and not have it installed on the c: drive. I want to install an OS and VS on the external drive, so that I can transport the external to any computer and have excess to my VS. Is this possible? I am having a problem figuring out how to do this.
The operating installation as well as the Visual Studio installation is tied to the hardware so you're not going to be able to do exactly what you want. However, something I've had luck with is using Virtual PC 2004 ( http://www.microsoft.com/windowsxp/virtualpc/) to do something similar. What you do is create a VPC image with Windows and VS.NET installed on it. That VPC image can be copied between machines relatively easily, though it is big. You may need to go into the VPC Console and set up the virtual machine to use a different physical network card. Of course, please be sure to follow any specific software licensing requirements for the software you are using.

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