I am using Dietpi as a VirtualBox image since it is easy for me to configure. I only have a Windows 10 pro machine and I also use it as homemedia server. The wifey does not like Linux, so I cannot run Linux on it. At the same time, my PC spec is not that great, or you can say a potato PC.

It is an Intel(R) Core(TM)2 Quad CPU Q6600 @ 2.40GHz 8 GB RAM. Even though it is a potato with Windows running on it, I can manage to run two Dietpi virtual boxes, one running for Pihole and the second for Docker.

The Pihole ran for maybe around 3 years, and there was no problem. While for the docker, I keep changing it and rebuilding it since sometimes I messed up with the docker, so I just rebuilt it because DietPi is easy to deploy and fast. Even with that potato, in under 8 minutes, including setting the IP, local host, region, install docker, Portainer, NPM, etc. I can have a fresh install Dietpi with docker ready to use. That's why I never worry to make mistakes on my docker VM.

That is my experience with Dietpi and the reason why I am still using it, so in my opinion, you can try it. Who knows it will fit your need.

The best OS to host on will someday be NixOS, bar none IMO. However, that BEST title will depend heavily on someone sharing a config that leverages the power of NixOS to make it as foolproof and rock-solid as other projects that leverage Nix’s power and reliability.

I’d host an instance if we could would move from the world of Docker being the only game in town toward a more reproducible standard config that uses Nix.

I am a bit confused. You said you were going to use Proxmox. It is a hypervisor built on top of Debian. Good choice btw. Why do you need another hosting OS? Proxmox runs the VMs and LXCs and is naturally your hosting OS.