Performance is perfectly fine as long as you pick an image with your computer's native instruction set and have hardware acceleration. Performance through QEMU (ARM on x64, x64 on M1) is terrible, of course, but that's to be expected with software instruction translation. With proper acceleration (which may be unavailable on Windows without some tweaking, even after installing HAXM!), Android will run similar to a standard Linux VM, at near native speeds.
One problem I've run into has been that Android relies heavily on GPU acceleration. If that's unavailable on your platform (because, for example, your driver is considered buggy by the emulator devs (common on Linux with proprietary drivers) or if all you've got is an integrated Intel GPU that already has its hands full rendering to your 4k screen), your experience will be terrible with any Android emulator. Android with software rendering won't be a bit slower and choppier like you see in desktop VMs; it will be absolutely unusable for anything but a cursory check to see if the software even runs at all.
There's also the addendum that many Apple products sporting an Intel CPU have had their power/performance curve and fan curves tweaked to be silent and super performant in short loads (compiling a single file, opening a browser, loading a page, etc.) but clocking down hard and long if you run a sustained load on them, especially with a multi core load. This can make a system that normally feels snappy and fast run terrible slow with an emulator. Similar problems also exist with cheap netbooks that just have insufficient cooling on the processor. I do believe the M1 designs are better suited for sustained loads, so with the new Apple stuff this problem should be gone.
When I was still running the emulator off of a hard drive, performance was severely lacking because Android is not built with HDD seek times in mind, but after switching to an SSD that quickly became irrelevant.
In my experience, running Android on a 12 core i7 with an NVMe SSD is actually running the entire system way too fast for a realistic development experience. Your average dev machine is much faster than whatever your customers will most likely be running your code on, so you still absolutely need to test on real devices.
Emulators are great for debugging because you get to test in an environment with close-to-stock Android (so you don't accidentally write code that only works on Samsung or on Pixel), but for performance and usability testing you need a physical device.
That said, I don't think running the Android dev emulator to play games is very efficient. It'll work and perform absolutely fine, but there's been no effort put into making controllers work or into optimizing controls for desktop.