Agreed: virtual macOS on Apple silicon is a toy
Well, you can clone, trivially: just duplicate the bundle in the macOS Finder. It's even a thin clone, thanks to APFS' copy-on-write. But you can't: as you said, take snapshots; bridge onto a network interface (so forget multicast, including Bonjour); attach USB peripherals; change virtual disk size; add virtual or physical disks; change number of cores; change memory size; control display characteristics to any extent; run more than two macOS VMs at once. (All with the latest Parallels, which is, it must be said, a slight improvement over the old in some respects.)
Just for laffs, I've been able to run ten (small) macOS VMs at once on an iMac Pro that benchmarks half as well as my new Mac Studio.
Grrr.
Biting the hand that feeds IT
