Not to dissuade you from running WordPress on your own workstation -- I'll let others with some experience doing that tell you how -- but I never feel comfortable until I've done a final test in exactly the same "environment". So, I run a second cloned copy of WordPress on my web host.
I use a Reseller account solely so that I can have an isolated environment: a reseller subaccount provides a separate filespace for each subaccount, (almost) eliminating the possibility of a rogue test environment clobbering your live environment by disallowing file writes on to your production WordPress environment from your test one. And, any I've tried, also prevent database access between subaccounts, preventing you from accessing the wrong database.
The only risk I have seen is when the WordPress and Blog URI's on the Test system are still set to the Production system values. As that will automatically redirect you!