I'm not quite following with what you mean with tier 1 and tier 2, which seems to be the reverse of type 1 &2. If you meant type 1 and 2 then VMware workstation or similar is most definitively a type 2 by definition. The exception to this is their enterprise VMX solution (note solution, you can't just buy the program and be done with it) that uses type 1.
Given limited resources, in most cases you will want a type 2 simply because given proper maintenance it is by far easier to maintain and upgrade for less tech savvy.
For some research that I've done last semester and if you are considering opensource and clusters, proxmox might be down you ally. Usually running on freeBSD again as a type2.
Questions you will want to ask yourself, is how many CPU's do I have. How much storage do I need, how many NICs (virtual) do I require for my task. What host/client OS will I be running. Will I want scalable hardware for peak times?
Depending on your answers these questions will dictate your choice(s).
Personally I'm using VMware right now. It's convenient, scalable, fairly secure (my cybersec project last semester was all about breaking it), has great managment tools, and broad compatibility. There I should now be VMware sales person
But do try out different solutions, and different client OS's. You'll find that some work better than others for what you are trying to achieve. There is no one host to rule them all.