Yes, absolutely. It doesn't matter where you install Veeam backup server and what VMs you're trying to backup/replicate. Please see our system requirements for more information > http://www.veeam.com/veeam_backup_7_0_r ... tes_rn.pdf
BTW, what kind of storage do you use? SAN or local? If you're using SAN storage, then you could potentially use off-host proxy servers that would allow you to avoid resource impact on production hosts.
Also please note that Veeam backup server itself doesn't produce any load, all "backup" work is done by proxy servers. If you have local storage only, then on-host proxy server will be installed on your production hosts, so separating backup console/server and on-host proxy doesn't really make any sense.
Here is more reading on what I'm referring to > http://helpcenter.veeam.com/backup/70/h ... proxy.html
Hope this helps!