Certainly could be done that way. Each OS would have to shut down [computer re-booted] so the other could be started.
What I did [had a computer left over from a job] is get a LinkSys [$70] KVM switch [keyboard, video, mouse] and set the second computer [Win98SE] under the desk. Using 1 keyboard, 1 mouse, and 1 monitor, I can have several things going at once. Pressing the Ctrl key twice changes computers. Saw a 21" Dell monitor yesterday that had inputs on the back for 2 computers.
A bare-bones computer could certainly save a lot of money when using the KVM.