a lot of the performance gains in rosetta 2 come from load time translation of executables and libraries. so when you run a binary on the host mac, rosetta jumps in, does a one time translation to something that can run natively on the mx processor and then (probably) caches the result on the filesystem. next time you run it, it runs the cached translation. if you're running a vm without support inside the guest for this, then you're just running a big intel blob on the mx processor and having to do realtime translation which is really slow. (worst case, you have an interrupt for every instruction, as you have to translate it... although i assume it must be better than that. either way you're constantly interrupting and context switching between the target code you're trying to run and the translation environment, context switches are expensive in and of themselves, and they also defeat a lot of caching)