It is just a glorified chroot so should work but of course it have certain specific bits and pieces. But one that has process separation etc.
Though wouldn't mind getting a more recent kernel like .32 on the device. What I'd like to see is: a) Have a minimal core distro running by default b) Have a easy to use select menu to pick a vserver to start c) start the vserver for example maemo5 - > get to it's GUI etc. d) be able to clone the m5 vserver before doing an upgrade so in case of badness can easy to switch back to the old one