Hello David,
You can already consider the stuff provided with your board and contained in the SDK iso.
There is a nice user guide in html, a lot of pdf and some basical stuff like kernel, uboot image and so on.
The user guide explain to you the aim of the rcw and so on.
For the host, I have used a dedicated Linux (RHEL 5) but a recent centos or ubuntu could also fit well.
I can not give you an answer concerning the use of a virtual machine.
Best regards.
/simon