As far as I know according to all vendors best practices the thin provisioning should be enabled on one level only. I would recommend you to start with if you need LSFS of StarWind. The general information can be found here:
https://www.starwindsoftware.com/turning-tbs-into-iops
https://www.starwindsoftware.com/eliminating-io-blender
But making a long story short, it is designed to
- Eliminate IO Blender
- Significantly increase the speed of the storage system, especially when talking about the spindle-based systems
- Provide complete Business Continuity
So, if you are not running spindles, then you can use Flat images of StarWind, and consider thin provisioning on the Storage Spaces or Vmware level.