Druplet module was a handy tool in the early days of multi-site. Some mighty-fine developers have worked out a much more elegant solution called Ægir and I suggest you take a look.
A Druplet is an on-demand Drupal sandbox generating machine. It uses Drupal's multi-site and install profile capabilities to allow for multiple unique sandboxes running under the same codebase. This module is not meant for use on production servers. Rather, it is a time-saving tool for developers.
There are some critical server configuration issues regarding this module. See the README.txt for more information.
== IMPORTANT! NEVER ALLOW UNTRUSTED USERS TO EXECUTE PHP CODE ON YOUR SERVER! ==
If you are using this for personal/internal use, the security issues are minimalized issues. However, if you allow non-trusted users access to execute PHP code on your server, they can potentially read the settings.php file of another Druplet. One line of defense is the paranoia module, which disables the PHP input format completely. In Drupal 6 this is handled by simply disabling the php.module in Drupal core.