Ok so I found a solution for people from the future just in case.
Install vulkan-swrast as per https://wiki.archlinux.org/title/Vulkan#Software_rendering. It will install a vulkan driver which vulkaninfo picks up. Also DXVK finds it. FYI I did of course have problems making it work… The problem was that when running vulkaninfo it complained about not finding a shared file in /usr/lib/libLLVM-17.so. I had libLLVM-16. Things/versions change quickly in Arch world!! This was because I had to update the LLVM package via pacman. But better still ensure you pacman -Syu for a full system update before you install the vulkan-swrast and all will be fine.
This is for development and debugging really, but for my purposes of getting a vulkan capable device on a system with no hardware vulkan capable device, it works a treat.
I didn´t need to provide any other command line environment variables for the Spitfire plugin to load and operate correctly. I am using DXVK 1.7.3 as installed from winetricks but this is old so probably upgrade to the latest using winetricks dlls dxvk or install from the git repo manually as per instructions at https://github.com/doitsujin/dxvk?tab=readme-ov-file.
Thank you LinuxGaming321 for your help and ideas. I hope this thread is useful for someone else in the same boat.
David