I'm considering doing this myself. I'm getting pretty tired of having to log off my kids, including deciding what to call unsaved homework files every time I need to reboot the computer.
XenDesktop offers a 10 user free version which would be great for home! But it requires a domain controller on a separate box. Not ideal for a home network.
VMWare view runs over $1500 for a license, pricing it out of the home solution category.
VirtualBox would allow you to start up headless VMs and access them using RDP. I think it should support Win 7 in this mode as well. http://www.virtualbox.org/manual/ch07.html#vboxheadless
It would seem that what you would need is a minimal linux server with VIrtualBox and various user accounts on it. You could then do some simple scripting to automatically fire up a virtual machine when a user logs in to their account. This VM could be viewed on the server directly or remotely via RDP. You wouldn't get the cool machine management tools of XenDesktop or View.