Unfortunately I've found the combination of Parallels 16 and Big Sur disappointing with a Mac VM: I have a litany of problems that I've waster a lot of time exploring a lot of different settings. I have a reasonably powerful Macbook Pro (16GB RAM, i7 processor, 1TB disk, 2017 model). Problems I've had
I wish I'd waited a few more versions of Big Sur, Parallels. They often sort these kind of things out.
- laggy performance on the upgraded Mac VM, sometimes on the laptop monitor and sometimes on the external monitor
- freezing for a few seconds on a mouse click or some other action
- USB drives not appearing in the VM
- VM crashes or Finder crashes when trying to browse the external drive
I wish I'd waited a few more versions of Big Sur, Parallels. They often sort these kind of things out.