Windows Server 2008 R2 to pfSense
I currently have an HP ProLiant ML370 G4 server, (retired from a business), I am currently using it as a Web Server (IIS), File Server (documents and pictures as well as client files are stored here for me to access from other computers on my network), Active Directory, Domain Controller, and DNS. If i switch to using pfSense on this server, will i be able to do all of these things? or should i dedicate an old PC in the parts closet to a pfSense box and not bother switching?
Ahem, pfsense is a firewall, period.
Some have installed pfsense in a virtual machine on hardware similar to what you describe. The idea is to save some power and use the leftover horsepower from their server for the firewall.
Personally I prefer to put pfsense in it's own box. Depending on what you have lying around, it can be very productive and it tends to limit the variables in your network issues.
Just my $.02, YMMV :)
You don't say how you plan to run a VM on that multipurpose box, but pfSense on 2008 HyperV is not a trivial task. The superior solution is much easier, build it on a re-purposed spare box. In fact, built two :)
PS having a firewall/internet gateway/DNS/DHCP up and running when working on your server is VERY handy as well.