You don’t technically need a NAS, the Pi can be it, but you’d need a usb 3 enclosure (way cheaper than a NAS). But honestly just let your pihole be your pihole and don’t mess with it. You may wanna get a pi zero and use that as your DNS and your old pi as a Plex server.
Yes you could but then every time you need to service your Pi your whole house will be left without internet.
For me personally it was a great decision to move my containers from the Pi with pihole to a dedicated media server. I did not ever get a warning that resources were low again and I have no unrelated downtime.
As a bonus, I also have the Pi VPN in there, so I can basically restart my media server remotely and not lose connection :D