That's where I wonder about a tool like this interfering with legitimate software

You are right, some games, especially multiplayer ones will refuse to work in the VM to prevent cheating, but this is, of course, the business decision on their side. You can always construct the software in such a way that when it detects something suspicious on the system it ceases to function: some copy protections looked up for change in the network card hardware id as developers presumed it is highly unlikely someone will change network interface, but that stopped to be common, when people started using on-board interfaces that change with every motherboard change. There is also a difference when using commercial stuff such as vmware instead of qemu or virtualbox as open source is more suitable to be tailored to the specific thing, in this case, cheating. In the end, this approach works well for slowing done malware as there is less risk for normal software to allow working inside o…

What do you mean by 'legitimate software' exactly? If you described what a modern anti-cheat solution does to someone without telling them what it is, they'd automatically call it malware. The similarity really is uncanny. It almost feels like the difference between them is more of a technicality.