I've been running PostgreSQL on a virtual server for several years
now. I'm using VMWare with a Windows host and Linux guest. I've
configured it to let Linux use a raw partition as a disk. Before I
used a separate partition, the virtual disk had been a Windows
file. Using the disk partition increased performance, but I don't
recall now exactly how much. This is a small setup with a handful
of users. The database contains only dozens of tables, but some
have ~8 million rows. I've allocated 1Mb of RAM to the virtual
machine.