Hey Patrick,
Booting up a Windows instance on a Mac machine will not be detected as a VM. What they're probably actually doing is using VM software (like Parallels) to load that "Bootcamp instance" (or as every other piece of software in existence calls it: partition on a hard drive) inside a VM.
In other words, they're running Windows in a VM and TurboActivate is correctly telling you that they're running your app in a VM.
>> " If I were to Allow Virtual Machine Activations, would this solve this user's issue?"
It depends. The actual solution is to use TurboFloat: https://wyday.com/limelm/help/vm-hypervisor-licensing/
If you just all TA activations in VMs it might work for a little while. Or it might work until the next reboot. So, the actual solution is to use TurboFloat.