I'm going to forward my findings to Ben Armstrong (i.e. the "Virtual PC Guy" at Microsoft) for analysis, however, I already have a theory on the source of the excessive CPU utilization. For starters, it seems isolated the client VMs, both of which are running a high-resolution monitoring agent (DMS Clarity Metrics Tracker). This agent makes frequent calls to PDH, WMI and the Registry, and I'm guessing that Virtual PC 2007 is generating a lot more overhead when processing these calls than Virtual Server. The agent also uses a set of high-resolution timer objects that likewise seems to give Virtual PC fits.
As a simple test, I tried disabling the agents on each VM. CPU utilization for virtualpc32.exe immediately to dropped to below 10%. Case closed.
Bottom Line: For testing applications that use high-resolution timers, or that make frequent calls to certain system libraries, Virtual Server 2005 R2 SP1 does a much better job of handling what should normally be a very fast, lightweight operation. And with VMRC Plus, you don't have to sacrifice usability in order to reap the rewards of better real-time application support under Virtual Server.