Here is my 2 cents. First of all, like @Drew-r , I don't do VSTs… yet. Heck, I don't even have a proper weighted piano either. But, I can speak for a Mac M1. I got one (iMac 24") almost as soon as they came out in June, after my long in the tooth but loaded 27" from 2011 gave up the ghost. The only CPU intensive tasks I threw at it where compiling code, processing photos, and transcoding videos. This M1 Mac (I got 16GB and 512GB of internal storage, to be safe for at least another 10 years) is by far the fastest computer I ever had: no joke. The new 14 and 16" laptops are even faster! But expensive, and overkill if you are going to attach it to a piano semi-permanently. The Mac mini is ideal for that. Once set-up, use VNC or similar to control it from an iPad or a remote computer: no need for a monitor on top of the piano…
Based on everybody saying they can run any kind of modern VST on a 3-4 years old Intel Mac, I'd say that you'll be very comfortably running all your VSTs on a M1 Mac mini. They are on sale now with a $150-200 discount at Amazon, but that's only the 8GB version: Amazon doesn't sell the built-to-order systems with 16GB. I don't know if that's enough memory long-term and you can't upgrade later either. I would future-proof by getting 16GB, as I did with my iMac, but then again, maybe all VSTs are fine in 8GB: I don't know.
As for storage, if the role of this Mac mini is mostly or only to play VSTs (and you keep it velcro'd under your piano for example), I would go with 256GB and an external SSD, with at least 1000MB/s of throughput. It does not have to be a Thunderbolt drive either: USB 3.2 at 10Gb/s (or 1000MB/s roughly) is fine. I got such a drive. a 2TB one, to keep my photos and be one backup of the main drive for about $400: this thing is tiny! OWC 2TB drive