The primary advantage of VMs is that you can have many of them and have them dedicated to a single purpose. If you have dedicated relay VMs with enough resources to run ILMT, then your relay VMs have too many resources and they should probably be lowered.
There are significant security advantages to dedicating a VM to a single task. You can lock it down much tighter for a single purpose. Every purpose you add on to the VM is more holes that need opened.
Also, You can manage resources better. You may need to scale up bulk storage to have a larger relay cache, but you might need to scale up the IOPS of your storage for ILMT in some cases. These are very different storage needs.
The relay might be fine for ILMT now, but in the future, it may need to scale up much more so.
Also, if this relay is hosting the ILMT UI, then the maximum number of users that can connect to that UI will also be affected by the number of clients connecting to the relay due to the number of open TCP connections.
What if you need to reboot the ILMT system many times during troubleshooting or upgrading? This has happened to me many times. What if you then need to reboot the relay that is hosting ILMT due to a relay issue? Having separated VMs minimizes downtime and risk.
What if the relay cache balloons for some reason and causes ILMT to run out of storage? or vis versa?
If you do this enough, then it should be automated and streamlined. If you don’t do it often enough, then do it the right way / harder way. This is never a valid reason to do it a less ideal way, even if it is the reality of your organization.
You should be able to automate the installation and configuration of just about anything through BigFix and/or another combination of tools.
One of the only times I can see putting a relay on something that has other duties is when it is in a location that does not have a datacenter and does not have a way to host VMs. This is typically on the fringes of the network where there aren’t a lot of clients anyway. This is where you might find desktops being used as relays in some cases.