Keeping an Electrum Litecoin wallet on a VM won't mitigate this vulnerability. The only 100% safe way to mitigate it is to keep your wallet offline until you can upgrade to an updated version.
This was a more general remark, not particular about this specific Electrum vulnerability.
Keeping things separated on (properly protected) VMs can mitigate some attack surface and potentially avoid issues compared to keeping all your wallets on the same host. Of course with Spectre+Meltdown everything is up in the air currently in regards to securing things. Best is to keep very important stuff offline, if possible, I guess.
There are exploits that could escape the security that a virtual machine could bring, there is no such thing as complete isolation unless you are using an airgapped computer physically removing wifi cards and anything else.
Specte+Meltdown is insane and proves all computers are compromised by default... generation of private keys in completely offline computer was always the only way to keep your bread safe.
