What I didn’t realize is there are some additional steps to take to enable WebDAV for use on my development server (Windows Server 2003 VM).  Here they are in case you are trying to do something similar:

1. Enable WebDAV in IIS (found in the Web Service Extensions section)
2. Enable and start the WebClient service

Apparently in Windows Server 2003, the WebClient service is disabled by default.  In case you are wondering what this service does, here is its description:

Enables Windows-based programs to create, access, and modify Internet-based files.  If this service is stopped, these functions will not be available.  If this service is disabled, any services that explicitly depend on it will fail to start.

Wahlah, I am now able to access the document library using Windows Explorer with a path like the following:

\\mossdev\sites\SearchCenter\Documents

Step 1: Find out what others are saying

http://msdn.microsoft.com/en-us/library/ee554869%28office.14%29.aspx

http://weblogs.asp.net/sharadkumar/archive/2009/10/20/sharepoint-2010-setting-up-development-machine-on-windows-7.aspx

Step 2: Reinstall the correct version of Windows 7

Before getting started or reading any guides, I installed Windows 7 Ultimate N, which I now know the Beta only works on non-N versions of Windows 7.  So far off to a great start

http://social.msdn.microsoft.com/Forums/en-US/sharepoint2010general/thread/dec7a208-662f-4c4d-bbae-f04f937b2e86

http://social.msdn.microsoft.com/Forums/en-US/sharepoint2010general/thread/cfa12d9f-2253-4d70-9f6a-c73441d43fd5

Step 3: Install a butt-load of prereqs

Stuck to the MSDN guide and all went well.

Step 4: Install SharePoint Server 2007

Make sure to run the setup.exe in the extracted folder created by following the MSDN guide above, not the downloaded .exe.

Step 5: Configure the SharePoint Farm

I received the following error:

Installing the following KB update corrected this problem:

http://connect.microsoft.com/VisualStudio/Downloads/DownloadDetails.aspx?DownloadID=23806

Step 6: Tune SharePoint and SQL Server

I could use some recommendations for this step.  After completing the installation and creating my first Site Collection, there appears to be 4 IIS Worker Processes and 7 or more Windows Services running related to SharePoint.  I will be experimenting with timeout settings for the application pools and max memory settings for SQL Server and let you know what I come up with. If you’ve got some insight on tuning, please let me know!