I think that separation is the point of the VM. Do the dev work in the VM, don't give it sensitive info about yourself.

That protects me (the software developer/maintainer) to some degree, but does nothing to protect the users of the software I am maintaining.

As long as your are creating web applications then browsers are pretty good at limiting blast radius of a single attacked website. Well, at least until attacker discovers that he can inject some fancy phishing into trusted site.

With local development environment it is a bit different, because unless you are running build/test etc. in a container/vm/sandbox, then attacker has access to all of your files, especially web browser data.

Development should be more exploratory and experimental than prod. For the past decade I've had a similar strategy: I freely install and demo new dependencies on separate dev hardware (or a VM when I'm on the road). Then I code review (incl. locked dependencies) and deploy from a trusted environment with reduced supply chain exposure.

The only place I log into from the VM is Github, protected by 2FA in case any malware gets my password.

The malware will just take the session cookie. Some actions still require 2FA approval, but it’s not many, iirc.

So the malware can delete all your projects or inject malware into them, but thankfully it won't be able to log in again later?