I would say that going to the extent of setting up and running a virtual machine is a little overkill for the sake of one application. It's also a little unsatisfactory to have to partition your drive and install a whole new operating system, though unfortunately it is becoming quite commonplace with an increasing number of people finding limitations with Vista.
Like Risherz suggested, your first port of call is to try the application in Vista and if it fails to work use compatibility mode. There are no guarantees and I've had mixed success with it, but it is definitely a more elegant option than a second operating system.
Is there a newer version of the application available for Vista or not out of pure interest?