On Windows, testing different OSes is made simple using VMs. Is there a simple way to do something similar for Mac testing, where I might need to run on Tiger/Leopard/Snow Leopard to verify functionality?
AFAICT, to run OS X in a VM you need OSX server or buy multiple Macs - is that what folks out there do? Or are there other cheaper options?
You could have a single Mac with different partitions for each OS, or you could virtualise OS X server. Within the constraints of Apple's Mac OS X EULA you cannot virtualise Mac OS X.
The paid-for memberships of Apple's developer connection include the ability to download and use a range of previous versions of OS X and OS X Server for developer testing purposes. As the select membership is $500 and OS X Server is $499 then I'd think that's going to be cheaper if you want to test more than one variant of the server.
Due to the license, you must use Mac OS X Server if you'd like to virtualize. If you get an early Intel mac that will run 10.4, you could partition the disk and install 10.4, 10.5, and 10.6 simultaneously, though rebooting in to each OS can be a hassle.
These days there are more Mac OS X variants to test than just major OS releases. Depending on your target customers, you might also want to test on PPC, i386, and x86_64 architectures.
If you're lucky enough to live near Cupertino, Beijing, or Tokyo, and you're an ADC Select or Premiere member, you can use the ADC compatibility labs for this sort of testing.
That said, you could probably pick up a couple of older machines pretty inexpensively and get somewhat varied hardware.