No DO NOT set your 3rd party router using PPPoE for its WAN connection.

You need to set it as dynamic IP WAN type as authentication is already done by your TIME supplied Huawei router turned into bridged mode.

TIME does not use the obsolete PPPoE for authentication unlike TM Unifi. Authentication is done on its server side to assign IPs to its router/ONTs. We call this method IPoE.

https://vasexperts.com/resources/glossary/ipoe/

Usually if you're using an ISP other than TIME on their network then only you'd need to put in the VLAN to separate the traffic.

If you're using Time Fibre ISP just like Allo where you're using the incumbent ISP, City Broadband then no need VLAN. The IPoE authentication is already done and untagged by bridged device itself except the LAN routing part and DHCP assignment.