In the exam, you will have a number of machines that you need to exploit, you can get partial points for partial access, meaning a local shell but not root/Administrator access will get you partial points. Full access (root/Administrator) will give you full points. Each exam scenario might be different but what will really help you is lab time and practice. The more time you can spend on different machines with different exploits, the better your chances are for passing the exam.

To answer your question: since you have limited time, you aren't expected to test possible exploits on a local system, that would mean having different flavours of OS running along with vulnerable web applications or vulnerable software installed locally which could be anything such as an FTP service, web browser, media player etc... Detailed reconnaissance will definitely help you, and good Google skills.
I highly recommend the course, the contents are explained clearly, the labs are great and if you spend as much time as you can in the labs and practice exploiting as many machines as possible, you should do fine in the exam.

Good luck!

Thank guys. J0rDy, I read your walk-through, it was great read. You mentioned how there are things on exam which are not mentioned in courseware.. I would appreciate if you could provide some pointers about the books etc you had to refer.

@blackzero, the exam lab is very cleverly set up it does make you try harder.

The exam is hard but not too hard, I would say it's just right.

How is your experience with exploit development blackzero? as you need to create an exploit to complete the exam, but remember Try Harder!

that will be more then enough to understand the buffer overflow part in the OSCP course. use the internet as your main resource and if you can't seem to find particular information (for example in depth knowledge of nmap) focus on available books. Good luck and i think you will do just fine!

H1t M0nk3y, be careful of the spoilers, you may want to edit your post accordingly.