Does Rundeck have to be online or I can simply host it on a local VM? If it has to remain online, then why? or If it can be kept on a local VM would that work? if not, then why?
Rundeck needs to be online to execute the workflows that you define, whether in a virtual environment or not. Just make sure that the Rundeck instance can access the remote nodes.
A good way to test Rundeck is to use the official Docker image.