How do I use subdomains for separate Drupal "sites" on my server?

All,

I'm sure this has been done, but I can't find a good HowTo on the subject, so here goes.

I have my own Drupal site running on my own server. http://www.warrenernst.com/.

Suppose I have a client who wants to start using Drupal for themselves, to see how it works and if they like it. I would love to set up http://client1.warrenernst.com/, but I would like it to use the Drupal installation I already have going in the web server root directory, but the content would independant.

In other words, I want the subdomain sites on my site LOOK like stand-alone Drupal sites that aren't linked like my site in any way, but they use the Drupal files I have already installed.

I assume that this means a whole new database (and/or user) in MySQL (good!), and a new configuration file for Drupal for the second (and third, or fourth, or fifth, etc.) site. Is this right? How do I do this?

I assume I also need to set up Apache for subdomains too, which is something I haven't looked into yet, but I assume is done all the time. Any good sites with pointers on this too?

Thanks,
Warr