Leaderboard

To answer your questions directly about one or two SQL instances for WSUS. Is that it will cause conflicts between the two WSUS Servers if they share a db. Aka if some deploys an software update (SU) on WSUS, it will get installed on CM clients too (outside of CM control). From the CM standpoint, CM will change that products and classifications existing within WSUS, including declining SU too. Thereby stopping any WSU deployment of that SU.

This will not be supported and you WILL have problem when you manage WSUS outside of SCCM for non-SCCM computer. There is NO problem having WSUS installed on the CM server with its own clean db.

Start with a Clean WSUS server using full SQL server.

you can use these guides to get going for server 2016 see below for server 2019 see below

you don't want to use an existing WSUS server. You want a fresh one that is use SQL database not WID.