Yeah, sometimes there just isn't another option. I have a 60GiB Win11 VM for things I use every few months for a couple of minutes at a time
I'd recommend https://www.qemu.org/ for virtualisation
https://virt-manager.org/ for a gui to manage VMs, you can easily add or remove cores, memory, internet, directories etc really easily.
https://github.com/winfsp/winfsp lets you add a directory from your host to the VM to easily share files
https://github.com/virtio-win/virtio-win-guest-tools-installer makes the cursor seamlessly move between the VM and host instead of pressing ctrl alt g to escape.
Win11 23H2 still allows for offline set up. Just press shift f10 when you're at the internet set up and type
oobe/bypassnro
The VM will reboot and give you the option to select I don't have internet so you can just use a local account
https://github.com/Raphire/Win11Debloat/ for getting rid of the unwanted bloatware
Theres also an easy way to activate windows for free, I don't think I can link it here but its on github and MAS-sive amount of people have starred it.