Look into Veeam agent for Linux.
https://www.youtube.com/watch?v=g9J-mmoCLTs
I successfully did a full bare-metal backup of my pve host and restored into a VM (with host-only network, so as not to have IP address conflict)
Alternatively, I have homegrown scripts for baremetal backup/restore and general sysadmin:
https://github.com/kneutron/ansitest/tree/master/proxmox
Each method has advantages, so I do both - on alternating days.
fsarchiver will allow you to restore to smaller disk, but you have to run the Proxmox installer beforehand to recreate the LVM. It can also convert ext4 to XFS on the fly (and vice versa) but the process is a bit more hands-on. I have taken steps to try and make things easier for end-users and document the full process.
Veeam agent will restore the LVM for you - but NOT LVM-thin!
You still need to have backups of your VMs and critical files. It also needs same-sized disk to restore to (or possibly larger, haven't tested it)
Whichever method you go with,
test your restores. A backup is not a backup unless it restores properly, and the resulting environment is as expected.