I’m never a fan of virtualizing network related items for the sake of redundancy, if your server goes down the rest of your network can keep doing it’s thing. That being said, with the hardware you have on your hands i don’t see any solid atonemen argument for bringing in more hardware.

Proxmox is a great base for you to really ramp things up and i’d recommend looking into pfsense as a routing/firewall solution. There’s a bunch of great youtube videos that can talk you through setting it up and using it as your vpn point, adblocking, reverse proxy, and so much more.