The DAW, in this case Cubase, plays quarterback for quite a number of things.
On one hand it makes sure that the MIDI information is sent/received at the right time.
On the other hand it operates as a “host” for the VST effects, and VST instruments. Each effect and instrument requires its own set of resources, both CPU and RAM in order to function properly. Every time you load a VST effect and/or VST instrument, some of your computer’s RAM is dedicated for that specific instance. For some instruments, the resources required may be very low in terms of RAM. In other instances, those instruments that use samples to recreate acoustic instruments may be loading hundreds of individual samples to allow them to play in a realistic way. We’ve gotten to a point with sample-based instruments that some, like VSL, could have 16 or more samples to recreate a single note. This comes from the desire to replicate the differences in sound from quiet to loud notes, as well as what’s called “round robin” samples which are duplicates of the same note at the same volume so that they don’t sound exactly the same when quickly triggered by the relatively mild MIDI work required. Then there are all of the possible articulations available for the specific instrument (open, flageolet, muted… etc)
As has been mentioned, many DAWs, Cubase included, can be set so that one instance works solely to host instruments that are then triggered over a network (this can even go so far as across the world in some situations). When using one DAW to send MIDI information to another DAW that is hosting the instruments (or samples), the MIDI goes from “System MIDI” to “System Instrument/Sample”, but the only thing that returns is audio. In this way, only “System Instrument” would be required to have the licensing for the instrument. In this situation, the method used to get the audio to the right place depends on the needs of the “studio” involved. This could be as simple as routing it to a mixer via audio cables, or as complicated as using MADI or Rednet to transmit audio in packets over ethernet.
With iLok, the typical implementation in a professional environment is still to have the physical iLok USB dongle attached to whichever system needed the authorization. This is as opposed to having the iLok License Manager authorize the specific product directly to the computer. Otherwise you would need to remove the authorization from the computer and move it to another, rather than just moving a USB dongle from one system to another… and I’m sure I’ll receive confirmation here from others who’ve been doing this a while that iLok is far from a flawless system and sometimes when moving licenses around… problems can occur.
Working with a modern DAW is complex, and there’s a lot to learn for all of us, and more to learn every day.
For the most part, if you start to rub up against RAM or CPU limitations, there are simpler methods to deal with them than adding a new computer to the mix. If you anticipate the need to keep making changes to a track, but not immediately, freezing a track will temporarily convert the MIDI+VST Instrument into audio. This will free up the RAM and simplify the required CPU usage. Otherwise, if a specific track is complete, then bouncing it to audio will allow you to take the instrument’s RAM requirements out of the equation and put them to use elsewhere.