I have tried the new Parallels M1 for apple M1 It does work with the arm edition of windows 10. But i find it is pretty much useless now. They did not really put any features in the arm edition making worthwhile to use. You can't load any RSAT tools on it.
Also I hear that linux has been ported to it but the only thing parallels for M1 is good for the the arm windows.
And snapshots is not working now. But if you need windows now i think you better off not using this.
To me Parallels put this out as a marketing gimmick. Not really much user till they develop it a little more