v8 and by extension isolated-vm by itself does not cover things like fetch if we're talking JS. https://github.com/laverdet/isolated-vm/issues/63 This is an immediete killer as js browser features are part of why a js engine is wanted.
Having node handling these things is a time bomb of debugging where instead of debugging v8 you're debugging node. There are node version problems with stability as mentioned on the isolate-vm readme.
DOS goes beyond just CPU time and memory. Wasm is being treated as an environment of its own with some lower level accessibility. Unless the API allows feature whitelisting - I can't find any docs relating to that - then I don't see anything stopping thread creation. I'd be interested to know how cloudflare prevents these features. isolate-vm doesn't appear to interact with the v8 api with options relating to this.
Fly.io has their fly engine meant for local development so you can deploy onto their servers. https://github.com/superfly/fly