That is a weird take, to install SmartOS inside a VM for anything else than a PoC. SmartOS is meant to run on bare metal and host its own VMs / zones. It works either way of course but it's funny for an "Illumos cafe" to not go full on Illumos on the setup.
In any case, I admire the effort.
And yet we live in a world of cloud computing running OSs in VMs.