Emulating extra displays

I found the solution using Xephyr and Xdmx

First create the Xephyr displays

Xephyr -screen 1920x1080 -ac :1
Xephyr -screen 1920x1080 -ac :2
Xephyr -screen 1920x1080 -ac :3

This creates 3 windows 1920x1080, each of these will act as a monitor

Next add the xinerama layer onto these virtual displays

Xdmx +xinerama -xinput local -display :1 -display :2 -display :3 -ac :4

Next create a fresh terminal and start your window manager or application like so

DISPLAY=:4.0
xmonad

or if you just wanted to test an applications xinerama support instead of xmonad you could run xterm or thunar.

You only need a single instance of Xephyr.

Xephyr +xinerama -screen 1920x1080 -screen 1920x1080 -screen 1920x1080 -ac :1

If you need RANDR extension, add +extension RANDR args.

Xephyr +extension RANDR +xinerama -screen 1920x1080 -screen 1920x1080 -screen 1920x1080 -ac :1

This works for me:

Xephyr +xinerama +extension RANDR -screen 800x600+0+0 -screen 800x600+800+0 -ac :1

Although DISPLAY=:1 xrandr still returns only one screen, my C application calling XineramaQueryScreens(dpy, &new_num_mons); gives me the right geometry.

I don't know if this was possible back when the other answers were posted, but here's how you create a 2x2 grid with three virtual monitors occupying the top-left, top-right, and bottom-left quadrants, and a blank space in the bottom-right quadrant to mess with things that assume there's no dead space:

Xephyr +xinerama -screen 640x480 -origin 640,0 -screen 640x480 -origin 0,480 -screen 640x480 :1 &