Note to self: Sometimes, just because you can technically do it, does not mean that you should.
I decided to save some time and defrag a Virtual PC VHD by mounting it in Windows 7. The mounting was easy, the defrag was easy as well. Started Virtual PC back up and it said “Hey, your drive is read only!” I said “crap, what did I do?” Oh, yeah, I forgot to UNMOUNT the VHD from Windows 7. So, I UNMOUNTED the Virtual PC VHD from Windows 7 and I was thinking, wow, if this works, think of the time savings! Restarted Virtual PC and it said, “Umm, you know, you modified this disk, WHICH, BY THE WAY, had a differencing disk.” I decided to tread on and made some changes and exited, feeling pretty good. Came back a little later and tried to restart the Virtual PC with its fresh defrag drive. OOPS, registry is crapped out and it makes sense. Oh well, back to the back up and Lesson learned.
NOTE: Defrag the VHD from its own OS running, not from some fancy smanzy trick of mounting the VHD in the way cool Windows 7 RC. Yeah, Windows 7 is cool and it allows you to do other things with VHDs that do work.
Go BING it!