Hi Eagle1Studios,
I was speaking with another technician about this and he is using Amazon Web Services to accomplish a lot of what you are asking to do. It is apparently pretty cheap too.
Is this a commonly used method to overcome the lack of processing capability on a home desktop?
Commonly? Not really, no. Though it is plausible to use this technique, it is still a good idea to have good processing power in your machine. Having 6 gigs of ram will be a holdup for you one way or another as a developer. I would suggest bringing that up at least to 8gb.
Let me know if this helps you.