Yesterday, I decided to jump straight into the deep end and installed MS SQL Server 2005 (which I wasn't really worried about, I've been running it since Beta 1) and Visual Studio .NET 2005 on this machine. Just in case you're wondering, this machine is my main dev box (though not my main dev server, I'm not quite that bold). The verdict? SWEET! My ASP.NET 1.1 apps still run and connect fine with my local instance of SQL Server 2000.
Why didn't I wait? Because what is possibly my next phone, the HTC Tornado / Cingular 2125, will be out in less than 2 weeks so I need to be prepared. The new APIs exposed in Windows Mobile 2005 will allow lazy coders like myself to actually get some cool apps made, unlike the current situation where any "real" coding requires you to get a little more native than I care to learn at this point (especially for what is little more than my version of playing with tinkertoys).
VS.NET 2005 and MS SQL Server 2005 appear to run fine on my machine, which is also running SQL Server 2000 and .NET Framework 1.0 and 1.1. So when the time comes to decide if you're going to jump right in, my lawyer says I should tell you "no, don't do it!" but I'll let you make up your own mind. :)