You can run virtual machines in z/VM, but you can also partition the machine at the firmware level. (Partitions are called "Logical Partitions" or LPARs.) Maybe that was what they meant by "bare metal virtualization".

Virtualization and emulation are not the same thing. You can have one without the other.

(Traditionally, virtualization precluded emulation: The hypervisor simply multiplexed hardware, and the guests got what looked like raw access to the real hardware, with no way of "seeing" the hypervisor at all. Very secure, very simple, and you could run a hypervisor as a guest with guests under it, recursively.)

Emulation is never going to be fast.

Sure it is. The s390x instruction set is microcode emulation on top of a POWER-derived microarchitecture, just as modern x86 chips are microcode on an underlying microarch.

Completely wrong. s390x runs on its own dedicated hardware, it is not emulated on POWER. POWER and s390x are completely separate.

source: worked at IBM on their compilers team.