Straight from the Microsoft EULA:
An ISO-9660 image file is an exact representation of the original installation media, including the content and the logical format. The most common use of an image file is to write it to a blank DVD Recordable disc resulting in an identical copy of the original DVD including file name and volume label information. ISO Images can also be extracted directly to a file location by many Recordable DVD utilities. For more information about image files, please visit the TECHNET FAQ
Can I use evaluation software received in my TechNet subscription at home?
In most cases, yes: the license grants installation and use rights to one user only, for evaluation purposes, on any of the user?s devices. Each individual product, however, can have its own license agreement, which will control how many installations are allowed. Keep in mind that you may use the evaluation software only to evaluate it. You may not use it in a live operating environment, a staging environment, or with data that has not been sufficiently backed up. You may not use the evaluation software for software development or in an application development environment.
TechNet Subscription product keys can be used to activate software on up to 10 machines. An additional product key may be requested by contacting your local TechNet Subscriber Support.
Although you must go through the activation process each time you reinstall on the same PC, your total number of activations will not be decremented.
For Windows, TechNet subscribers have a 60-day grace period before the product must be activated. If you will be reinstalling the software in less than 60 days, you do not need to activate it. Please note that Windows Update and Windows Genuine Advantage require that the installation be activated.
For Office 2003, TechNet subscribers have 50 launches before the product must be activated.
Software may be reinstalled on the same machine as many times as needed without reactivating it. However, if the hard disk is reformatted prior to reinstallation, reactivation may be required however the total number of activations will not be decremented.