Hello,
Same issue here. It has been happening for a very long time, but recently seems to have gotten worse.
For me, it used to be that the VM would freeze for a while when attempting to scroll with the mouse or when popup notifications were displayed. Occasionally the machine would hang indefinitely. Lately, that has been happening more often, forcing me to either Quit or sometimes Force Quit the VM.
Interestingly, the issue only manifests when scrolling with the mouse (trackpad, I'm using a MacBook Pro) but if I grab the scrollbar instead and move it manually the VM does not hang.
When the machine is hung, it will typically be using 2 or 3 CPU cores at 100%, suggesting some kind of spin.
Also, along with this issue, I have found then when installing or updating Parallels Guest Tools it will hang indefinitely at 100%.
I have submitted a technical report for the last instance of a crash after I had to Quit the VM because it was frozen, the ID is 433957663.
Any help is much appreciated.
As with OP, I am on an M1 Mac. Specifically, Apple M1 Max, MacBook Pro 16-inch 2021. Running the latest macOS build: 13.5.1 (22G90)