I think that performance wise there may be differences but with a fairly decent computer, like niles said, it’s probably marginal. (Some VSTs that utilize parallel processing, might get more out of fewer instances and multi-timbrality.)
I am from the old world of MIDI (even use CV-MIDI still) instruments (as in hardware synthesizers), and I tried using the VST Instrument rack, but I believe it’s just perpetuating the traditional MIDI concepts of Ports and Channels. Mind, nothing wrong about it, some plugins are made for this type of use and even more importantly many people prefer it.
Eventually, I got sold on the Instrument Tracks which essentially keeps a one-to-one operation between Track and Instrument, and it is a little bit of a trade-off as far as flexibility goes. E.g. you cannot split an Instrument across two Tracks (duh, obvious of course, but that’s what I meant with trade-offs).
From a sound point of view, the rack creates another layer of administration (albeit with more flexibility) for me, since I no longer just creates an Instrument Track, choose a sound and record, but I now have to organize the programs and setups using MIDI Ports and MIDI Channels in the plugin, as well as on the MIDI Track.
I still use MIDI Tracks for all my external synthesizers (yes, I have a few ) and to control other external MIDI devices, such as effects, that I also still use. These old clunkers have served me well, I will not let them down.
Oh maybe I should note that in the past I used some of my hardware as multi-timbral, but no longer.