In my opinion core infrastructure like the router should not be virtualized. I want to be able to work on my proxmox server or reboot it without bringing down the whole network. And if there is a problem with my proxmox server I now have the additional headache of having the network down too and my IPKVMs don't work.

Virtualizing the router adds a point of failure and set of dependencies for a critical component of your network. And you already have a good purpose-built hardware and no stated problems. So why virtualize?

Some years ago i posted something simillar to your post, in conclusion it is safe to run on a vm and have the ethernet ports pointed to it, i personally use bare metal since im still not too familiar with opnsense to start thinking of migrating to a vm

I run Proxmox on my router (an Intel NUC) with an OpenWRT VM (though I used to run OPNSense, and might try going back to it later). It makes things more complicated, but I'm familiar enough with Proxmox that I'm okay with that complexity.

Setup right, I don't think you'd experience any performance hit in terms of your network, and your 8th gen i7 is likely better than my Celeron J4025, so I imagine your Web UIs will be fast enough even virtualized.

I virtualized my router because it let me experiment with different router options way more easily (I could switch from OPNSense to OpenWRT and fall back on my old OPNSense VM if I messed anything up, I could setup VLANs in a cloned VM and fallback to my old VM if I couldn't get it working, etc.). I'm a very indecisive person loll. But if there's no reason for you to virtualize it, then I wouldn't bother unless you just want to.

I vaguely remember my Intel NIC gave problems with OPNSense, but running virtualized meant I could use Linux drivers (via Proxmox) and give OPNSense a VirtIO NIC that it would be happy with. Oh, and it's nice being able to run the Unifi Web Server in an LXC on the router so it doesn't go down whenever I mess with my server PC.

Personally, I only run network-specific things on my Proxmox instance on the router (so, OpenWRT/OPNSense, and the Unifi Web Server). My more home-lab stuff is run on a completely separate machine. Like others have said, I don't want my internet to go down when I mess with my server.

If you do end up virtualizing ur router, in my personal experience using VirtIO network devices for the VM seems to work best for me (the E1000 seemed to hamper my upload/download speeds quite a bit, VirtIO made it pretty much line-speed — that could just be OpenWRT quirks or my NIC, idk).

I went with a dedicated mini PC with one of those motherboards that are designed for building a network appliance. It has been running very smoothly for a few years, and I just log in occasionally to run system updates.

I want my network and Internet connection to continue working, regardless of my tinkering with home server stuff.

I run opnsense in proxmox for a couple reasons. 1) I can snapshot the VM prior to upgrading, in case of an issue I can just rollback. 2) backups, I can backup the whole VM, which includes all the plugins, Not just the base opnsense config. 3) I don't run anything on bare metal except my laptop.

I run one OPNsense on each of my two proxmox cluster nodes, even with DPI I never had problems reaching 1000MBit/s

Performance is going to be the same.

Security is the main point here.

If this is your internet facing firewall then you want minimal layers of software complexity, so bare metal is the answer.

I'm a pfSense user, so I don't know how regularly OPNsense is updated, but, it's so much easier to just reboot that 1 box whilst everything else is mostly unaffected.

Better still, do a full device backup before an update and then you have a simple disaster recovery backup in case of any problems.

I virtualized my OPNsense years ago via Proxmox and put it on HA. I've had it failover to another node that blinked out for some reason, and not noticed it for weeks. I'm a complete believer in virtualizing it. I used 2 nics per node and the external NIC is on a switch across all nodes. YOu could use VLANs instead.

Not to mention the snapshots before updates, and restoring via PBS (which I've had to do and takes a few minutes). I would never go back to bare metal.