Yeah dunno if this is an Apple problem or a Parallels one, but Parallels support is useless as always. This is all I got for my support request:
Hello Kendall,
Thank you for contacting Parallels Support.
We understand that you were experiencing low performance on Windows virtual machine.
And after changing the hypervisor to Apple fixed the issue.
If the issue re-occurs please reply us to this email for further assistance.
We appreciate your time and patience.
I guess I fixed it myself! lol. When I pointed out that it would come back when I went back to the Parallels hypervisor they then asked me to generate technical reports for both with and without the parallels hypervisor on (not sure that would make any difference!). I already had a technical report in my original email.