This question comes down to what your priorities are for your Virtualization project. If you are trying to simply consolidate servers to use less hardware and control costs of operating legacy servers, blades may not be the answer for you. But if you have a new project starting and are looking for a way to create a highly scalable infrastructure, blades will be at the core of your solution. Blades give you incredible economies of scale for adding additional computing power without the need to change your space or power requirements as you likely will have dealt with that when implementing the chassis for the first blades. When implementing a blade solution you will also be tying it into an existing Storage Area Network (SAN) or implementing a new SAN solution. While this does change the initial cost of the infrastructure it does provide an incredibly scalable storage solution for growing businesses.

Virtualization being an implementation on top of the blades allows for maximum usage of the power of the multi core servers in your new architecture. This would be true of a stand alone server as well, but a chassis only hold so many physical drives and limits the scalability. You can add cards to a 1U server for the SAN, but the redundancy of the well built blade chassis will far outclass the capability of the 1U chassis.

You need to take the time to evaluate why you are Virtualizing, I have found blades and a SAN to give our small company incredible growth and scalability potential.