2.1. Because they removed VNC.
Well you can argue about this all day but the documentation I saw said it was removed due to security concerns. As VNC simply is not secure and isn't meant to be, I don't see this as a problem myself. Y'all can feel free to agree with that or not as you wish.
2.2. Because you can't run Apple operating systems on VPC 2004.
No, but that's because VPC 2004 is a x86 processor emulator, not a 680x0 emulator or a PPC emulator. Virtual PC has never emulated the Mac environment, even when it was a connectix product, so this isn't something Microsoft have taken out of the product.
Also, Apple tend to keep their software and firmware stuff to themselves and almost certainly would not licence it for a product like this.
There is a version of Virtual PC that runs on the Mac which allows you to run Windows on top of a Mac. Details here. It was the original connectix Virtual PC Product, I believe. I've got it, it works, it's quite neat, it allows me to take those one or two programs I absolutely need but cannot find on the Mac away with me when I'm traveling with my iBook. Not much else I can say about that really.
[update June 2004] For those of you who are desperate for software that will allow Mac OS X to run on Windows, there is something that might help you out there. It's not ready for prime time but you might want to look at PearPC which is a free, open source project for runninx the Mac OSX environment in Windows.
Some screenshots from the site: http://pearpc.sourceforge.net/screenshots.html
Well I know that's what it said on slashdot, but I suggest you click on the picture above and take a good look before getting too upset about it.
Microsoft have made a commitment, in public to support any 3rd party operating system running in a virtual machine as they would any other 3rd party application running on top of windows: "We will treat the use of Linux in a virtual machine just like we treat the use of any third party application running on top of Windows. We will direct the customer to their Linux provider for support. If their Linux provider triages the issue as a Virtual PC issue and provides us with a bug report, we'll work with them to fix the issue." - Benjamin Armstrong, Microsoft Virtual PC Program Manager, speaking in a newsgroup posting in the group Microsoft.Public.virtualpc on the 11th Nov 2003.
Seems fair to me. If you still are not convinced that Linux works in Virtual PC 2004 then I refer you to the picture above. Click on it and stare at my computer defying thousands of slashdot posters until you feel better.
In addition to the above screenshot of knoppix, I've also had Red Hat Linux booting in Virtual PC. The only Unix I've had problems with, in fact, is Open Darwin, but thats so fussy about hardware that it doesn't want to run on many real PCs, let alone virtual ones ;-)
2.4. Ok Wise Guy, so how do I make Virtual PC work with Linux (or BSD or whatever)?

In the virtual PC console, click NEW, and follow the wizard as you would to install any other kind of system. Pick "Create a virtual machine", go on and give it a name, and under "Operating System" select "Other". Now in the RAM and Virtual Hard Disk settings, specify suitable values for your "Other" guest OS.
See the list in the first section of what devices are emulated for a list of the drivers you need to have available for your Linux install. Remember, you need to install drivers for the emulated hardware, not your real hardware. Given that emulated hardware is usually a bit behind the curve of modern physical hardware you might actually find this isn't too difficult to do. Once sourced, drivers install in the virtual machine the same way they would on a physical one.
Job Done.