What we would like to do is install multiple Delphi versions on the same machine, those versions are D7, D2010 and DXE.
We had previously D7 and D2010, worked OK tog
I've had no trouble ever installing many different versions of Delphi on the same machine. It's a well supported configuration because, for example, component vendors need to be able to test all versions that they support.
You can use one VM per Delphi, but you can equally well put all the versions of Delphi on the same machine.
When I put multiple Delphi versions onto a single machine I make sure that no version of Delphi is in the system PATH. Then when I do automated command line builds I add to the PATH at the start of the build script. That way I am sure I always get the desired version.