Moving Winwdows 2003 Clustered Environment to VM w/o Cluster

I have been tasked with migrating our clustered environment to VM so that we can retire our blade center. I plan on doing this one directory at a time until everything is migrated. Then I will shut down the cluster.

What would be the best way to do this and what possible “gotchas” are there that I need to be aware of?

regards