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The majority of nanos users don't do either of these methods. They simply create the image (in the case of aws that's an ami) and boot it. This is part of what makes them vastly more simple than using normal linux vms or containers as you don't have to manage the "orchestration".

When I first heard about unikernels my hope/thought was that people would go back to using more bare-metal servers for unikernels.

there is a workaround for nested virt requirements.

you can use PVM patch and para-virtualization. I've seen several startup using that approach to be able to create VM on small/cheap EC2 instances.