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Here's what I have: Windows Server 2008 R2 machine (for development and testing), and a few machines. There is no domain, each machine (including the server) is purely local.

For certain reasons, I think it would be benefitial to me to make my Server box a domain controller and create a new domain. My question is, how will that affect my workstations on the other end? In other words, if I add those computers to the domain, what will startup look like for those machines? (Windows 7 if that matters) Will it ask me to choose whether or not to log into the domain or the local machine?

The reason I am apprehensive about this is because my server isn't always on (like I said, it's just for dev and testing). I don't want my end user workstations in my house to go haywire because it can't find the DC.

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If the DC is just for dev, why would you need to join existing workstations to the dev domain? – jscott Dec 2 '11 at 1:35
@jscott because I want to be able to log into the workstations as domain users. – Shark Dec 2 '11 at 1:36
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Yes, you'll be prompted to log in as a domain user by default, although you'll still be able to log in as a local user without any problems. Because it'll expect a domain login, it'll automatically prefix the username with the domain - it'll also say above the username and password boxes which domain it's going to assume you're logging in as a user on, in case the workstation knows about multiple domains. To log on as a local user, you can prefix the username with the hostname of the workstation - WORKSTATION\myuser, for example.

If the domain controller is unavailable, it shouldn't cause any problems with the workstation itself, but you won't be able to log in with your domain account. Workstations will cache domain logins for a certain period of time, but that's to improve performance and minimise the effects of transient network issues rather than allowing domain logins in the intentional absence of the domain controller.

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When would the machine stop looking for domain credentials? In other words, say my DC goes away and I no longer want to keep seeing that I can still attempt to log into this now-nonexistent domain, how does that work? Make sense? – Shark Dec 2 '11 at 3:47
You can simply unjoin the clients from the domain (which doesn't require the availability of said domain) and they'll revert back to workgroup mode. – joeqwerty Dec 2 '11 at 4:03
As @joeqwerty says, you can remove them from the domain. Until you do that, you'll still be given the option to log in, whether the domain controller is available or not. – Andy Smith Dec 2 '11 at 11:00
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