Thank you for posing your query on Microsoft Q&A. From above description I could understand that you are looking for information if you should follow Arc enabled SQL server or Machine Arc within defender for cloud console for vulnerabilities assessment.
Please do correct for any discrepancies in my understanding by responding in the comments section.
Microsoft Defender for SQL servers on machines uses vulnerability assessment to discover, track, and assist you in the remediation of potential database vulnerabilities. Assessment scans provide an overview of your SQL machines' security state and provide details of any security findings. You should see SQL Server and SQL Database recommendation in Micrsoft defender for cloud.
So, this works in 2 dimensions, it does assess the vulnerabilities at SQL server machine level as well as at SQL server database level. If you go to Microsoft defender for cloud > Recommendations, it shows Vulnerability assessment for both SQL server as well as SQL databases, PFB snip for example:
So, answer to your question is, you must see both see the SQL Database and Arc enabled SQL server for improving your tenant secure score.
Please "Accept the answer (Yes)" and "share your feedback ". This will help us and others in the community as well.
Thanks,
Akshay Kaushik