Why else would you even consiter using a computer beyond the novice level?
For ME and XP, eh...
Advantages:
*You can run programs (like video games) that run under ME but not XP. For this reason, 98 is probably a better system to use, because it is a bit faster.
If one OS dies, you can still use the machine even at reduced functionality.
Hardware that doesn't work with XP can be used in ME.
Disadvantages:
*Will take up a good bit of HDD space, mainly due to the fact that ME CANNOT read XP (NTFS) partitions (however, XP can read and write to ME (FAT32) partitions).
Useless unless you have software or hardware that needs to be run under ME.
As a backup, it's not as trustworthy, especially if placed on the same disc (you can dual boot using 1 HDD for both OSes, or the better method of multiple HDDs for multiple OSes).
Performance Losses are possible, but not likely.
If you REALLY want to have fun w/dual booting, you can go for more exotic operating systems to play around in. Some examples:
MS-DOS 6 (for old games, provided you have a sound card with DOS support)
Linux (a popular choice of experienced computer enthusiasts, people looking for a good server and programmers, but is gaining popularity across the board due to it's improving ease of use)
FreeBSD/NetBSD/OpenBSD (Ever wanted your own version of UNIX? Pick any of those 3, and you get a BSD UNIX and more, what with all the free software for it and such)
BeOS (An OS with a cult following, but it declined in popularity when the company went bankrupt. It was quite powerful though.)
FreeDOS (If you want your own version of DOS to program in without having to track down MS-DOS compilers, then look at FreeDOS, which comes with it's own compiler (a GCC variant)).
Windows 3.1 (Set the Wayback Machine and impress your friends with Solitare...in full 16-color mode (no, not 16-bit)).