Everybody running their own lightweight copy of Apache on separate ports would be ok. You'll either have to have the same lib/perl directory for all the copies, or you'll have to watch out for syncronization problems where two developers change the same module. CVS or some other revision control system is going to be a MUST to keep each copy of the modules in sync if you go the separate directory route.
On a different note, the app server framework I developed supports dynamic loading of modules when they change (not going through Apache::Registry), thus eliminating the restart problem. And if a certain module chokes, it doesn't bring the server down (you just get an error message when you try to access it). The mechanism isn't that complicated, I can show you if you like.
Update Fixed grammer errors :)
/\/\averick
perl -l -e "eval pack('h*','072796e6470272f2c5f2c5166756279636b672');"