I made a disk image of the latest stable build (623 [1]) that works for me in Parallels Desktop (build 3124 [2]).
The disk image has enough room (I padded the img to a full 1 GB), runs with readable fonts (I patched xorg.conf as suggested in #3681), has working sound (I unmuted alsa manually) as well as network access (I added a S99parallels init script that simply does "ifup eth0"), and etoys uses framebuffer scaling to emulate the XO's native 1200x900 resolution.
Here it is (200 MB):
http://dev.laptop.org/~bert/Parallels-OLPC-623-bf.zip
- Bert -
[1] This is the stable version according to the wiki, builds 624 and 625 should behave no different when emulated.
[2] That's the German version of Parallels 2.5, not tested on 3.0, though I expect it to work.