How can I create a test copy of my production database that is updated daily on SQL Server?
The answer to your question is NO. Even rolling back all changes to the test database, you are still stuck with the fact that you cannot restore a differential backup to a database that is already recovered. You will always have to start over by restoring the latest FULL backup, then restore the latest DIFF that belongs with the latest FULL. Even if you save a copy of a 'FULL' backup on the test server (as Aaron points out in step1), you will eventually have to copy over a newer FULL backup to allow you to restore DIFFS that belong with that FULL.