Your virtual machines and Proxmox will work if they are on the same drive and they will also work on a separate drive. If you select a disk in the Proxmox VE ISO installer it will create multiple storages on this disk for you. One of those is certainly suitable to store virtual machines. You can find some information about default storages in our
administration guide.
If you have enough disks, it does make sense in my opinion to use a separate drive for Proxmox VE. For example, in case something goes wrong, it is then easier to just wipe the whole disk and reinstall Proxmox VE.
If you want separate disks, you can just click through the installer for the OS disk and then add additional storages/disks in the GUI of Proxmox VE.
Concerning RAID, I'll just quote the documentation:
I'd generally consider ZFS RAID a good choice. However, depending on how much data you have 16GB RAM is really not much.
And about virtual FreeNAS: I am pretty sure that the screenshot shows a FreeNAS VM with only virtual disks, no passthrough of anything.
View attachment 21264
Admittedly, it might not make much sense to have ZFS (of FreeNAS) on virtual disk, but it does start.
Anyway, you can install Proxmox VE itself in a virtual machine (and it will also allow guests - nested virtualization) on whatever computer you're currently reading this. So you can see how the ISO storage setup works and in what way you can install FreeNAS or Xpenology without spending a single Euro/Dollar/whatever.
