I think he means on the same physical or virtual server that 3CX is running on.
I have the same question regarding the restriction of running a DHCP server service on the same server running 3CX. That restriction was added with version 14 of 3CX. From the documentation of various versions, there is a progression of restrictions:
Version 11
No restrictions
Version 12
3CX Phone System
should not be installed on a host which features DNS or MS SharePoint services
Version 12.5
3CX Phone System
must not be installed on a host which features DNS, MS SharePoint or Exchange services.
Version 14
3CX Phone System
must not be installed on a host which is a DNS or DHCP server, has MS SharePoint or Exchange services installed.
I understand the restrictions on SharePoint and Exchange -- those can be very demanding on server resources, and tend to require use of ports 80 and 443.
For DNS, I found this post
http://www.3cx.com/blog/docs/free-edition/ which states:
"Firstly make sure that your are not installing 3CX Phone System on a machine that has:
•DNS – A DNS Server takes all available ports on the local host and may result in no available ports for Audio for example."
I had not heard of DNS taking all available ports, so I checked into that. I found this article:
http://www.foxguardsolutions.com/resources/details/a-closer-look-at-windows-dns-ports
That article indicates that 2500 ports are opened by the DNS server. That's not all available ports, but it is a good size chunk. Maybe that could cause a problem with 3CX.
For DHCP, if the server and phones are on a separate VLAN (which, in my case, they are) it sure is convenient to have the server on which 3CX is running to also provide the DHCP service for all of the phones. I can't imagine that for even a couple of hundred phones that this would add any significant load to the server, or otherwise interfere with 3CX. So, I really don't understand why that restriction was added for version 14 of 3CX.