Ubuntu – PXE Booting Virtualbox guests in internal networking mode

The 1st thing I've spotted was that you are using "-s /tftpboot" in xinetd.conf and adding the dhcpd.conf "root-path" option. Setting the "-s" option for tftpd means that is the "/" directory as seen for tftp client. So your dhcpd.conf should only have "filname /pxeboot", without the root-path option.

From "man tftpd":

-s

Change root directory on startup. This means the remote host does not need 
to pass along the directory as part of the transfer, and may add security.
When -s is specified, exactly one directory should be specified on the command
line. The use of this option is recommended for security as well as compatibility
with some boot ROMs which cannot be easily made to include a directory name 
in its request.

Well, I don't know if you can skip the bootloader, as it's necessary for even 1 OS/Kernel. Regardless, the bootloader is tiny and you can set the timeout to 0 or 1.

As for minimal/lightweight Linux, you can install a base CentOS distro without any custom packages and load it with Xen. I've done this very thing and I can get a bare-bones CentOS distro down to around 300MB (and probably smaller if I spent more time). It boots into Xen and starts up all the VMs I have created.

Once you have a base CentOS installed, run the following to install Xen:

# yum groupinstall Xen

Once it's all done, make sure you edit your /etc/grub/grub.conf config to boot the Xen kernel (set default to 0).

This guide may also be helpful for installing additional VMs:

http://wiki.centos.org/HowTos/Xen/InstallingCentOSDomU

I hope this helps!