There is no problem running one instance of SQL Server 2005 and one instance of SQL Server 2008 on the same machine. My laptop has both running on it and has since Beta 3 or so of SQL Server 2008.
The only thing you will need to worry about is setting up each instance so that they have enough memory so that they do not battle for memory. Also make sure that your disks are fast enough to handle the load from both applications at the same time (just like you would if they were in the same instance).
is no do not battle for memory. Also mang load from both applications one instance of SQL Server 2005 and one instance of SQL Server 2008 on the same machinememory so that tthey were in the samheyke sure that your disks are fast enough to handle the at the same time (just like you would if e instance).
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