After a fresh reboot of the VM I ran Battle.Net and launched Diablo II: Resurrected.
Only software I'm running in the VM other than the default Windows software is Battle.Net app and Diablo II: Resurrected installed through the app. Windows 11 Pro Insider Preview is build number 22454.1000. Just did a fresh install of Windows 11 Insider Preview this morning on Parallels Desktop 17 for Mac (Version 17.0.1 build 51482). I'm on an M1 Mac Mini running macOS Big Sur 11.6.
Glad to see a Parallels Team member is in this thread as well. Hello, wanted to pitch in on this as I'm very hopeful that D2R can get working in Parallels on M1.