Subdomain on parent server?

[Jonathan de Boyne Pollard]

J> My first thought is to create a subdomain (ie dev.domain.com),
J> place it in a separate zone file and not allow dynamic updates.

You are better off doing things the other way around, having the 
dynamically updated data in the subdomain and the static data in 
the superdomain.  

<URL:http://homepages.tesco.net./~J.deBoynePollard/FGA/dns-ms-dcs-overwrite-domain-name.html>
 
J> Can I place this subdomain (in a different zone) on the parent
J> server (and run a slave for both zones)? 

Yes.