Performance doesn't have to be supbar, infact with the right properties and focus on being lightweight - I see 90% of native performance.
I work on this as context: https://github.com/smol-machines/smolvm
How would you deal with a password manager or a clipboard in these cases, for example, without increasing friction for users ?
There will always be advantages and disadvantages to all of this. But the general idea is to protect the "core" OS, and for that virtualization is superior to anything else you could try really. Android and iOS are already built to isolate apps from one another. ChromeOS uses Crostini to run Linux programs in a VM, etc.
> without increasing friction
That's always the compromise with an Antivirus, isn't it? The logical thing would be to build password managers into the OS, or maybe even to handle them differently. As they are already done in Android and iOS today.
Either you end up with something don't work, too lax, or just DoS the user with permission dialog.