Windows Millennium is so buggy it hurts. If you want a BSOD experience, it's the way to go. I think you are better off with Windows 2000. True fact: I was the most prolific programme bug reporter for Microsoft on Windows 2000 SP4. They sent me free stuff
Clinton Fitch, one of the founders was a programme manager on Windows 2000 RTM and HPC:Factor's first server was Windows 2000 Server
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Windows 2000 doesn't solve your SMB 1.0 problems though. You need Vista or higher for that. It does support signing by default though, provided that SP1 or higher is installed, so part of the issue with 98/NT 4 are removed. If memory serves there are also a couple of modifications that you can make to force it to run XP code - i.e. newer versions of Chrome/Firefox.
However, to answer the original question. No, I think a VM is the best way to do it in 2020.