Why can't Virtual PC attach a VHD?

Question

It seems that Disk2VHD captured an entire HD rather than the boot partition (232GB versus 125GB)

I am hoping to bring up an image of my XP Pro box inside Windows 7 Ultimate x64 as a Virtual PC. Originally the boot partition on the XP box was 232GB but I used Acronis Disk Manager to shrink it to 125GB, resulting in unallocated space of 107GB on the HD.

Inside Disk Management console it looks like this on the XP box:

............ primary...................unallocated
Disk 0      MYVOLUME (C:)              XXXXXXXXXXXXXX
Basic       125.00 GB NTFS             107.88 GB
232.88GB    Healthy (System)           Unallocated
Online

and Disk2VHD has this

Volumes to include:....Size...........Free........Space required
[x] C:\ MYVOLUME       125.00GB       33.26GB.....94.22GB

I checked the feature to [x] Prepare for use in Virtual PC when creating the VHD with Disk2VHD. However, Windows 7 Virtual PC cannot attach to the VHD. So I downloaded VirtualBox to see what would happen. VirtualBox just opens a black rectangle and the disk never boots; it shows the full size of the VHD as 232GB (that is, the 125GB system partition plus the 108GB unallocated). Is the size of the original disk what is preventing Virtual PC from attaching? I was hoping that shrinking the boot partition would cause it to fall within the 127GB limitation.