The multiple instances of Linux, one it's so I can diversify what I'm running more easily if I'm running mulitple apps/projects. Also it's to dabble with different distributions. I'd like to get a mac os going some day. But mostly it's a simple and cheasy way to get goofygrid credit/hours, or for when WU limits are hit like Scole said. My setup on the 12c/24t t5500 is 3 linux vms all that use 4 threads each. So max threads they can use is half my total. It's my opinion that a lot of WCG projects pay slightly better on linux so what I would do is load up the linux vms first and then added windows threads of wcg until I felt I had the right overall load considering hyperthreading.
It seems that virtual threads are a bit more forgiving than the host's when it comes to CPU time. Like you said locking up. If you had a 4c/8t machine and setup a VM to use 5 threads and then you turned off your hyperthreading and launched the VM i bet it would work totally fine until you overloaded it and it would just bog but probably not crash the host.
In fact 3 of my windows hosts all have linux vms running on them. Right now since I think cosmology CAMB runs better on windows I have them all idled out just running nci. but when things change I'll often run 3threads on the Linux VM while the host runs a gpu.