I noticed the other day that Windows 7 Beta includes a utility called IsoBurn.exe that allows you to write disk image files to CD and DVD. However, there doesn’t seem to be utility for mounting ISOs, which I think is far more useful. These tools really should have been included in the client OS back in XP, but I guess you could always get a copy of DvdBurn.exe by installing the Windows Server 2003 Resource Kit.
On a more interesting note, Windows 7 also allows you to create and attach virtual hard disk files using the Disk Management utility. You can even configure the BCD so you can boot from a virtual hard disk. Aviraj Ajgekar has published a couple of thorough blog articles that walk you through the necessary steps.