Hi @user_3445655,
1. (Should the PE-VLAN be created on the switch to prevent the traffic from dropping?) ---------------> Yes, the VLAN corresponds to the outer VLAN should be created on the QinQ switch to prevent traffic from dropping.
2. (Should the CE-VLAN be created?) -----------> No, only the outer VLAN needs to be enabled on the switch. The inner VLAN is transparent to the switch.
3. (Is the QinQ supported on the sub-interface?)---------> Yes, QinQ encapsulation can be performed on both Layer 2 interfaces and routed sub-interfaces.
When service data is transparently transmitted over an MPLS/IP core network using PWE3/VLL/VPLS, a routed sub-interface on a network-end provider edge (NPE) adds an outer VLAN tag to a packet based on the user VLAN ID. The packet is then transmitted on the PWE3/VLL/VPLS network using the outer VLAN tag. Packets from multiple user VLANs can be transparently transmitted through a sub-interface, which is called a QinQ stacking sub-interface.
QinQ encapsulation on routed sub-interfaces is also a form of flow-based QinQ encapsulation. A QinQ stacking sub-interface must be used with the L2VPN service (PWE3/VLL/VPLS); it cannot be used for Layer 3 forwarding.