Yes, you can nfs mount /usr/src and /usr/obj into the VM and run installworld from there. This is the recommended way of doing source upgrades on multiple systems with similar hardware (build on one machine, install on many).
Signal 11 errors are sign of (usually) RAM issues. You should run memtest86 or memtest86+ or similar on the host hardware. It could also be signs of overheating CPU, or dying harddrive.
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