I've heard that this works wonderfully for graphics, but the sound emulation is pretty terrible. At least, I've heard about clicks and pops when the game puts much load on the system. This was on a friend's machine; maybe he had it configured badly.
Well if you're giving some hypervisor-managed sound interface to the VM then I wouldn't be surprised to hear that. The answer is to get a cheap dedicated soundcard and pass it through to the VM, just like you would with the graphics card.
