Running Docker inside a VM is the recommended way to run Docker on Proxmox.

Personally, I just run Docker inside LXC containers. Aparently, this is supposed to be not entirely stable, but its never given me any problems. (I commit an entirely different sin against efficiency, by keeping each service in its own LXC container, each with its own Docker host.)

I also run Immich (in Docker inside a container), and haven’t noticed any performance issues. But I’m the only user, and I don’t use it heavily, so ymmv.