For my test server, I use 127.0.0.1 for all domains because I don’t want external access to them. EACH test domain opens with its own files as specified by the httpd-vhosts.conf directives (and hosts file, too, of course). For the production server, I use the DNS functions the host provides with WHM/cPanel but with the fore knowledge that each IP Address seems to require its own cPanel and only one “master domain” is allowed per IP Address (addon’s are added as subdomains of the “master domain”).
A little more information from you might cut through any confusion here.