You definitely want an 8th gen (Intel) or better to have Jellyfin Quick Sync support. It’s what I have (i5-8400T) and it offer a fairly decent AVC (h264) and HEVC (h265) transcoding for my usage. However, for futur proofing consider an 11th gen for the AV1 support.

I’m containerizing everything, I like to keep my setup simple, no OS containerizing since I will be using a low power minipc (NUC, Hp mini, dell micro or lenovo tiny), I will use proxmox in the VM to get an idea on how it works and because I think the web UI might be easier to use than SSHing to the VM. Later on the new server I will mostly use debain+docker.