Final answer:
To safely test applications in a virtualized environment with isolation from the host and external networks, yet allowing VM-to-VM communication, you should set up a Private Network in Client Hyper-V.
Step-by-step explanation:
To test potentially rogue applications in a virtual environment while ensuring isolation from your production network and also allowing communication between the virtual machines, you should create a Private Network in Client Hyper-V. A Private Network allows VMs to communicate with each other without any connectivity to the host machine or the external network. This setup provides a safe environment to analyze and test untrusted applications without risking the integrity or security of your host system or your production network. Client Hyper-V offers three types of virtual networks: External, Internal, and Private. An External network provides VM access to the physical network, while an Internal network allows communication between the VMs and the host system. For your requirements, a Private Network is the best choice because it ensures that the VMs are completely isolated from both the host system and any external networks, yet still allows inter-VM communication.