Basically any open source project nowadays run their software stack in containers often requiring docker compose. Unfortunatley Smol machines do not support Docker inside the microvms and they also do not support nested VMs for things that use Vagrant. I think this is a big drawback.
So Vagrant is launching the VM locally, is that why it needs nesting?
Would you be ok with a trampoline that launched the VM as a sibling to the Vagrant VM?
I can support docker - will ship a compatible kernel with the necessary flags in the next release.