Perhaps a Raspberry Pi 500 (or the older Raspberry Pi 400), can do all the things an ordinary Raspberry Pi can, but comes as a complete device with built-in keyboard. Runs Linux and is rather easy to use.

Yeah, Bonzi Buddy!

If someone compromises the host system you are in trouble.

Not only the host. You have to trust every client to behave, as @forbiddenlake already mentioned, NFS relies on IDs that clients can easily fake to pretend they are someone else. Without rolling out all the Kerberos stuff, there really is no security when it comes to NFS.

Try diasbling the second DHCP server altogether. You only need one, since you have a flat network.

Are you sure there is exactly one DHCP server running?