Yes, you can... but I'm pretty sure you need a really fast CPU for the server to run happily. Or, at least, 2 cores. Is dual-core a baseline standard these days? I'm a little out of touch... I use an IBM Thinkpad G41 laptop with a single P4 3.33 GHz CPU. It's a real monster, but I suspect most modern dual-cores could out-perform it. It's one of the few laptops with a "real" GPU built-in, though, which is why I like it.
Wow, that went off-topic real fast.
Anyone run a server and client on the same machine with good results? What are your machine specs?