Before starting make sure you have all licenses required for the servers to reinstall them. (especially Windows 2003)!
So you want to go virtual...
Start by calculating the current amount of resources on your machines.
Keep in mind that you are now able to share some resources between machines.
So if you now have 4 dualcore machines it doesn't always mean that you need one big octacore.
Now for virtualization solutions there are multiple options.
In general you want to go with something easy to use (for you) and with as little overhead as possible for the system.
If you want to go open-source then you end up with a linux distribution running KVM or XEN.
If you're lazy (like some sysadmins i've encountered) you could use virtualbox, but as others commented this is not recommended.
My recommendation would be VMware ESXi which is a free hypervisor from VMware.
Both solutions offer snapshots and easy exports of machines.
Keep in mind that ESXi might have hardware issues but will run on any HP or Dell server and in my experience even on most standard desktops and home-grown systems.