This seems like the chip is incompatible with QEMU. You might need to cleanup, do a factory reset, and use VZ emulation using the 👇🏻
/Applications/Rancher\ Desktop.app/Contents/Resources/resources/darwin/bin/rdctl factory-reset
/Applications/Rancher\ Desktop.app/Contents/Resources/resources/darwin/bin/rdctl start --experimental.virtual-machine.type vz
Let us know if that works