I think you got me wrong. It is Q2, 'which Moodle version', which is off topic in this forum. Q1, 'VPC or dedicated', fits perfectly here and you are welcome to continue on that. From the intro, "This forum is for discussing issues related to computer hardware for Moodle, as well as comparing notes on Moodle's performance under load. Advice on finding an internet hosting service also belongs here."
> Do you think a dedicated server running Linux with this specification will do the job well ?
What is the job exactly, I mean do you have any relevent technical data? The kind of data I'm talking about is explained the performance documentation linked from the introduction to this this forum. The only information we have: a) 120 students and b) some courses with long videos.
The point is, nobody can tell to a reasonable accuracy what exactly the "load" is going to be. The common solution is to buy the biggest server one can afford. At the present level of hardware prices this means that the servers are often way over powered, in the West at least.
Comparing the servers:
A. dedicated Intel i3 2100 3.1Ghz | 3M SmartCache ; 4GB DDR3
B. VPS with 8 GB RAM
When you say, 'which one is better', perhaps you meant their computing power. You need to run a benmark on both to find that out. See the discussions:
- Performance perspectives - a little script http://moodle.org/mod/forum/discuss.php?d=57028
- "Unixbench" http://moodle.org/mod/forum/discuss.php?d=200362
The next problem is, once you have the numbers how do you interpret them. May be one server is better in CPU operations but slower in disk I/O. One has more RAM but slower network latency, etc. I doubt that there will be a clear winner, in general. In your case too, server A could be better in CPU and disk I/O but has half the RAM.
This comparison is of no use, if both servers are over powered any way. I would choose the VPS because it wastes less energy. If the need arises, and it will ultimately according to the https://en.wikipedia.org/wiki/Niklaus_Wirth#Wirth.27s_law, you can always migrate to a more poweful machine. Some VPS hosters provide upgrades without you having to reinstall. Even if you had to, it is not a big deal. See http://docs.moodle.org/en/Moodle_migration.