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Consolidation gains come from two sources: raising utilisation from the typical 10 to 15 percent of dedicated physical servers to 60 or 70 percent on shared hosts, and from newer hardware being several times more capable per socket. Multiplying both gives ratios of 20:1 or higher, which is why virtualisation displaced one-application-per-server so completely.
Consolidation
total demand = servers x current utilisation; capacity per new host = capacity multiplier x target utilisation; new hosts = ceil(demand / capacity per host)
Headroom is needed for bursts, for host failure so surviving hosts can absorb the load, and for maintenance. Sixty to seventy percent is the usual planning target.
No. Memory is frequently the binding constraint, and licensing, I/O and network bandwidth can all bind before CPU does.