Thanks for raising the questions, and please allow me to answer the questions:
syllogist1985 thanks for the heads up, while this consideration is decided, because the Azure Function Proxies can only have some basic controls over the API, and APIM would do much more, the comparison has been listed on the blog post, and we would strongly suggest to give it a try and see how that goes.
yashgupta This option is only working in a Windows environment, per my test. For details, the out-of-process app will differ regarding different .NET language versions, I would suggest opening a support ticket if you have questions so that we could work with you to check more details regarding your project.
Hope it helps, and feel free to let me know if any further questions.