VM becomes unresponsive during Veeam backup

Issue was fixed for me with the following:
C:\Program Files\Veeam\Plugins\PVE\Service
Edit appsettings.json

VmbApiPreReadQueueDepth - change from 32 to 4, restart services
 
We have fixed this issue by creating a seperate volume on our storage cluster for Veeam snapshots.
Now Veeam will not write its snapshots to the local disk of Proxmox anymore, but to our NVMe storage cluster (during backups)
 
Issue was fixed for me with the following:
C:\Program Files\Veeam\Plugins\PVE\Service
Edit appsettings.json

VmbApiPreReadQueueDepth - change from 32 to 4, restart services
Hello, might I ask what led you to this particular setting?

That sounds interesting.