I read up on it and I don't think I made my question clear.
I run Linux as the host
On the same physical laptop, I want to either span a single instance of the guest OS across two desktops (remember you can have as many desktops as you would like on a Linux machine)
OR
I want to fire up two virtual instances of the SAME machine.
I tried starting up the guest OS as headless then connecting locally but I only get a black or no screen at all. Apparently you cannot connect to a local guest via RDP, as you are really connecting to the host server and getting passed to the guest. I even tried 127.0.0.1 with no luck.
I don't see where I can end up basically two desktops for the Windows environment using a single VM
If you want to RDP to a local VM then you need to redirect to another port , eg. 4000 then you just connect to localhost:4000 an log on as @1\username,@2\username, ... but this only works for Windows and they all run in the same user context AFAIK.
In the case of Linux guests, you need to run remote X desktops. I think that you are pushing the envelope so will need to play / research. I doubt that you will get much help on this one.
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