If you have a free choice then I would suggest Ubuntu. Read, Installing_Moodle.
Note that 400 users doing a simultaneous quiz represents quite a high load. "How much hardware do I need?" questions are impossible to answer but it isn't a cheap VM. It will need to be a proper job.
If you're unsure it may pay you in the end to speak to a Moodle Partner.
I would also totally recommend Linux (Ubuntu is a great choice due to it's support and documentation) over Windows.
Every clients we have that uses Windows has lots more problems than the ones using Linux.
I would also echo Howard's comments - 400 users logged in at the same time is a big number - and you will need to ensure you have plenty of RAM, and a well-configured Moodle Quiz.
Our experience with Windows has shown that MS SQL does not handle large loads as well as MySQL.