I've successfully installed the latest snapshot (20100719) under VirtualBox. The box is configured with an IDE Controller PIIX4, maybe you set up a SATA or SCSI controller?

VirtualBox automatically chose AHCI SATA for me, I will try installing it with IDE. Problem is, my only currently working machine is an AHCI SATA controller, so if this is not supported in openmamba, I will not be able to do a live install.

Hmm, even when using PIIX3, PIIX4, and ICH6 for my IDE setup in VirtualBox, it gives the same exact kernel panic.

So the problem must be elsewhere. You can start the system in debug mode and take a snapshot of the last messages by following these instructions:

http://wiki.openmamba.org/en/index.php/Problems_when_the_system_starts

Have you configured in the box a combination of IDE and SATA drives? This may issue a known problem in the root= kernel parameter, so you also can try with different root= boot options. Anyway we can diagnose this by looking at the debug messages as said above.