Windows Vista OEM

• Cheaper than the packaged boxed
  
• Is only meant to be sold through computer retailers with new built computers
  
• Separate DVD’s For Vista 32bit & 64Bit versions.
  
• You have to buy either a 32bit version or 64bit version, not available on one DVD.
  
• Possible Issues when upgrading hardware or “fresh” installing Operating System on other PC, as OEM is meant to be for a single hard configuration not like Windows XP OEM which could be activated on multiple computers.
  
• May posses support/activation issues once installed (full extent unknown as yet).

Windows Vista Retail Packaging

• Official & Genuine Packaging & Manuals
  
• Is more expensive than OEM version
  
• Guaranteed Future Support & Activations
  
• Contains both 32bit & 64bit versions of Windows Vista for future upgradeability
  
• Hardware changes are more flexible & are done without any issues.
  
• Can be installed on any pc, not just official Vista computer building partners
  
• Less chance of you OEM version to be a counterfeit version (there are very good look-alike counterfeit versions available).

Straight from the horse's mouth -- "spokesperson" at Microsoft Australia:

"OEM versions of Windows Vista must be distributed to end-users with a fully assembled computer system and must be pre-installed."