Right now the way we are currently using we have 3 enviroments. Development, Test, and Production. On the same server we have the 3 instances as separate sites/domains. So we have something like this. This would work best for multisite
- domaindev.com
- domaintest.com
- domain.com
You need to have individual domains to be able to use the subdomain functionality of wpms
Once everything is tested on domaindev.com, we just push it to the test and so on. But if you have a current version of your site, and you want to add new features in a dev environment I would suggest replicating your live site on another domain, and maybe this script here can help you.
http://pp19dd.com/2011/01/bash-script-to-mirror-wordpress-mu-installation-into-a-sandbox/
Once you are done and test those changes, can just update your live site again.