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Restrict number of monitors for Remote Desktop sessions

Remote Desktop Services is the administration tool of choice for Windows Server admins and the display mechanism for many user scenarios. Many admins, as well as other knowledge and task workers, may have multiple monitors on workstations.
While server-side Remote Desktop resources usage is not resource intensive for most situations, it may be necessary to set a policy that limits the amount of monitors that may be associated with a Remote Desktop session.
Policy-based configuration has become more relevant with Remote Desktop version 7 support, which clients can use to connect with multiple display support. The primary use case to restrict multiple monitor support is to preserve resources on the server. Other use cases can be usage policies that require a certain resolution for computing environments, such as terminal server applications that work correctly on a limited number of resolutions.
One new feature with Remote Desktop in Windows Server 2008 R2 is that you can set a policy object to limit the number of virtual "monitors" assigned to incoming Remote Desktop connections.
In Windows Server 2008 R2's Group Policy configuration, there are new values for more granular configuration of Remote Desktop on the server. One of the variables is the Limit Maximum Number of Monitors Value, which is located in the Computer Configuration\Administrative Templates\Windows Components\Remote Desktop Services\Remote Desktop Session Host\Remote Session Environment hive of Group Policy for local configurations.
When using Group Policy in an Active Directory domain, the path is the same except the Administrative Templates hive has a slightly different name that indicates the policy definitions in use. In this value, a number is specified to configure the maximum number of monitors presented to a virtual desktop session.
If 1 is specified in the Group Policy configuration, multiple monitor connections are limited to the primary virtual monitor assigned. Read this MSDN blog post to learn about a few caveats.
The local Group Policy configuration is shown in Figure A.
Figure A

Click the image to enlarge.
This can also be achieved by configuring the RDP protocol option in the Remote Desktop Session Host Configuration application in the Administrative Tools section of Windows.