One of the best uses of encryption is that you can pull drives that die and not have to try to wipe them as they die or smash them. They’re encrypted so it’s just gibberish. Mostly the reason to encrypt.
I auto-unlock with two things: a USB drive I put in the computer that it looks for and another computer on the network that hosts an unlock file. I’m not defending against nation-states or the Gestapo, regular rubes won’t notice the pi zero hidden that hosts the network file. USB drive is for just-in-case so I don’t have to type that long ass password ever.
I didn’t try hard, but I’m not sure how to make auto-unlocking more secure.
Reading that is wild
Why are you doing Arch on a server? You want to tinker forever and read the update notes like a hawk lest the server implode forever?
Arch isn’t gonna be noticeably leaner than Debian.
Get Debian, install docker and/or podman, set unattended upgrades, and then install Incus if you need VMs or containers down the line. You can stick on ZFS and it’ll be fine, you already have BTRFS for basic mirrors. Install Cockpit and you’ll have a nice GUI. Try not to think you have to fiddle with settings, the maintainers for each package/service have set it so it works for most people (and we’re most people!); you’ll only need to intervene on an handful of package configs. All set and it’s not proprietary.