It can do a dual display setup. Click on "compare" then on "complete specs" (2/3 of the way down) on the page for the Mac Mini here:
http://store.apple.com/us/browse/home/shop_mac/family/mac_mi...
"Connects to up to two external displays with digital resolution up to 2560 by 1600 via Mini DisplayPort to Dual-Link DVI Adapter or 1920x1200 via Mini DisplayPort, Mini-DVI to DVI Adapter, or Mini DisplayPort to DVI Adapter. Analog resolution (VGA) up to 2048 by 1536 using Mini DisplayPort to VGA Adapter or Mini-DVI to VGA Adapter."