MagicMike
Advice? If I disconnect my PC from the internet, can I create a very basic virtual PC machine that resides on my PC and use that to connect to the internet? Does my internet adaptor have to be enabled on the host PC?
Good question. The answer is yes, you could limit your internet connection to a VM and leave the host offline. At least, it's possible in the VM I use (VirtualBox from Oracle).
However, that may still not be an ideal solution.
First of all, some of your third-party software (e.g. Waves) is going to have licenses that are tied to your hardware configuration. The most-used piece of hardware for that is the network card, because it's guaranteed to have a unique ID (its MAC address). Disable the NIC and the license will fail.
Second, the reason people leave their DAWs online is for convenience when authorizing new plugins. You're probably not going to be able to do an online authorization from within your VM. Products that use a simple license file won't be a problem, but challenge-response authentication requires that the plugin have a direct connection to the server.
Which is not to say your idea isn't do-able. Nearly all plugin vendors support offline authorization, even if some of them make it maddeningly difficult. Shopping, purchasing and downloading plugins could still be done in your VM.