answering your questions.
- can we add more resources to existing appliance? is that accepted practice?
Yes, you can do so.It is supported to resize the vm.
- can we add nodes to form a cluster and if so what will happen to the data collected?
yes, you could also add nodes, but i if it fits on one vm, why add complexity. But that is only my opinion.
If you change the vCenter, then your vm´s and other things will end up getting a new id. And the data collected could not be linked to the new data.
Hi - scale up and scale out are both supported - scale up means increasing VM resources within the parameters listed in the sizing guide posted above (e.g. there is a range of memory), once you have reached max resources for node type you can also move between node sizes e.g. medium to large or you can scale out e.g. add nodes. Expanding an existing node/cluster is supported without data loss. For an HA deployment you need to go through the expand option in the wizard to add a data node, you will then be able to enable HA which will convert the data node to a master replica (you will then have a master and master replica - these roles also perform the data node function as well as cluster management operations). All nodes must be sized the same for a supported configuration and you should create a DRS rule to separate them to maintain availability in the event of host failure when both nodes are on the same host. You can also put a load balancer in front of them to balance HTTP requests for the UI using a single name and IP though this is not strictly necessary - you can continue to connect to the individual nodes and see the data for the cluster. Hope this helps.