It can work well, but it will depend on the virtualization solution and what you expect your server to do. I've been running my JRiver server on a Windows virtual machine for about 6 months, and so far, so good (after abandoning the Win 10 preview and switching to Win 8 ). I use it for basic server functions and TV recording and it works pretty well. Getting the virtual networking working transparently took a few days, and there were some quirks related to running it on a headless linux host, but once I got everything lined up it's been working a treat.
I initially tried running it on a win 10 virtual image and that was less smooth, partially because Win 10 was still a "work in progress," but also because some of the builds wouldn't install correctly in a virtualized environment (related to some UEFI issues). I'll probably upgrade it to Win 10 eventually, but it needs some time, in my opinion.
I'm not sure if this configuration is supported or not (I would guess not), but so far so good over here. I haven't identified any "special issues" with using a VM for the server, everything server-related seems to work the same as on bare-metal (I probably wouldn't suggest using a VM JRiver for interactive UI or actual playback, as hardware acceleration is spotty).