First off 10.5 is obsolete OS X operating system version. You need to upgrade to something more recent.
Second if you update OS X to 10.7/10.8 to run commercial virtual machine software like Fusion or Parallels, all your present OS X PPC based software of 10.5 is no longer going to work and likey a lot of your older Intel software too, also your machine is going to run slow because it's a older machine and the newer OS X verisons of 10.7/10.8 are bloated pigs on older hardware.
My advice is to get a 10.6.3 white retail disk from Apple, then make a Carbon Copy Clone of your present 10.5.8 to a blank external drive and disconnet, then apply the 10.6.3 and update to 10.6.8.
10.6 will run your older PPC based and Intel software (Rosetta) and you can use the free VirtualBox to run Windows 7 in that, and/or use Apple's BootCamp which will require a free area at the bottom of the boot drive with no data.
It's the best option for your situation as you don't want to be spending more money on new software or having to buy a new machine. That machine is rather dated, it's at it's end of life stage so it's no sense to spend more money when it's going to die in few years anyway.
The only cost I see is the price of Windows 7 disk (and a external drive), the commercial virtual machine software will require 10.7 or later and keep costing money over and over again.
Apple is providing updates for Snow Leopard (10.6) so it's not a issue there to have to be on 10.7 or 10.8 and have older software and a slow machine as a result.
If you run into problems with the 10.6 upgrade, you can c boot off the disk and wipe everything and reinstall from scratch, then transfer files from the 10.5 clone you made earlier.
Most commonly used backup methods
Windows in BootCamp or Virtual Machine?
How to erase and install Snow Leopard 10.6
For Snow Leopard Speed Freaks
https://discussions.apple.com/community/notebooks/macbook_pro?view=documents