Have a lightweight linux distro that is focused only on booting up VM images. It would be targeted at end users, not servers. It is designed for normal 'semi-techical'/'non-technical' users, so they can have the flexibility of VMs, without the hassle of installing and setting up and configuring of VMs.
You
could use hypervisors, however in our case, we want this OS to run in as many places as possible, so we shall just only be using lightweight linux distros (like tinycore, or stripped down debian)
The philosophy of VMLinuxOS should be to be as easy to use as ChromeOS. Instead of a browser popping up however, the OS would auto bootup a Virtual Machine image. If there is no initial VM image to boot or the user decides to jump out of the virtualized desktop, a very simple GUI VM image selection menu is show instead.
The VM selection GUI (which is the 'main menu' for this distro), will have a few simple settings for various images. E.g. readonly, internet access, etc... to help maintain the images.
For convenience sake, the underlying host linux, should support a few small apps that allows for remote maintenance and access. For example support should be allowed for VLC connections or ssh connections over the web. Also vidalia should be installed for the few paranoid users, who may want to host the OS as a hidden service.
Applications:
A laptop can have various VMs, with a few OS set as backup in case an OS gets corrupted. In that case the broken image can simply be deleted, and replaced, without having to spend time reinstalling.
Alternatively, you can set a small VM image to 'read only' and use it to access banking websites. (since you can set images to read only at will, you can still set it to 'read/write' mode if you want to add stuff like 'password autofill'.)