I have seen some posts claiming that only ARM-based versions of Windows will run in Parallels on a Mac using the M1 processor. My understanding was that the new M1 Macs included an emulator called Rosetta 2 which would allow an M1 mac to execute programs developed for Intel processors. If Rosetta 2 will allow x86 programs to run on an M1 mac, why isn't Parallels able to take advantage of this capability to allow x86 Windows virtual machines to run? I'd appreciate any clarifications on how Rosetta 2 works with Parallels on M1 mac computers. Thanks.
Not an expert, but I am pretty sure that only ARM-based versions of Windows will run on M1. Having said that, ARM Windows provides its own solution, and I have some very old Windows x86 programs running here on ARM+M1, one more than 20 years old.
This will help you understand why Parallels is unlikely to ever succeed in delivering x86 emulation on Apple silicon: https://stackoverflow.com/a/73625246/1411125