I agree with you that the warning may be flawed.
I have a M1 Mac mini with 4 Performance and 4 Efficiency cores (8 cores total).
Configuring a Windows 11 ARM Pro VM on this machine:
- with 4 cores: no warnings. VM sees 4 cores
- with 6 cores: Warning about VM using too many cores and that guest OS may not be able to use all cores. VM sees 6 cores. The former warning makes sense because I only have 4 P cores in my system. I don't have a system with more P cores to see if the warning exists with more than 4 cores.
- with 8 cores: Same warning as 6 cores. VM sees 8 cores.
I can't configure the VM on my system above 8 cores.
Which Mac model are you running?
If you power on the VM with the desired number of cores above 4, does the VM power on even though the warnings are present in the GUI? And does the VM actually report that it's seeing the number of cores that you've configured?
The ultimate source of truth for how many vcpus are configured is the .vmx file. find the entry starting with numvcpus = and that will tell you how many vCPUs the VM will use. Only 1 socket used for all these cores, unlike for x86_64 VMs.
As a rule of thumb, though, configure no more than n-2 physical cores to a VM --- the OS, parts of the hypervisor, and other software need some CPU to process the tasks they want to run). You also may wish to limit your VM's cores to the max of the P-core count - the guest is unaware whether its virtual cores are running on E-cores or P-cores and can't control that like they can on physical hardware (sorry, that's Apple's fault as its their hypervisor frameworks that Fusion uses). .
On the x64 platform, there used to be distinctions on how many sockets could be supported by Windows Home vs. Pro. On Apple Silicon platforms, there is only 1 socket. I don't know if Windows 11 ARM has any restrictions on core count on Home vs Pro - since all cores will appear as they're on 1 socket. Perhaps again there's some historical baggage on reporting the "your edition may not support his many sockets/cores" for Windows ARM.