Can the new Workflow engine be installed on a SharePoint Server?

Before considering server deployment targets, it’s important to understand the new workflow architecture in SP 2013. A new option exists when you build a workflow for SharePoint Server 2013. This option is called Platform Type. The figure shows the Platform Type option when you are creating a new workflow by using SharePoint Designer 2013.

Figure 1: SharePoint 2013 includes three workflow platform options.
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The only platform available when you first install SharePoint Server 2013 is the SharePoint 2010 Workflow platform. The SharePoint 2013 Workflow platform and the Project Server platform require additional steps. The three workflow platforms are outlined in the following table.

Workflow Platform types available in SharePoint Server 2013

Platform Type Platform Framework Requirements
SharePoint 2010 Workflow Windows   Workflow Foundation 3 Installs   automatically with SharePoint 2013 Products.
SharePoint 2013 Workflow Windows   Workflow Foundation 4 Requires   SharePoint Server 2013 and Workflow Manager.

Note:
Workflow     Manager must be downloaded and installed separately from SharePoint Server     2013. It does not install automatically when you install SharePoint Server     2013.
SharePoint 2013 Workflow – Project Server Windows   Workflow Foundation 4 Requires   SharePoint Server 2013, Workflow Manager, and Project Server 2013.

Reference: http://technet.microsoft.com/en-us/library/jj658588%28v=office.15%29

What this boils down to: if you are running OOTB SharePoint 2013, it will have the SharePoint 2010 Workflow model built in, which runs on Windows Workflow Foundation 3 and “lives” in the OWSTIMER.EXE process just as it did on 2010. If we want to leverage the new 2013 Workflow engine, we need to install the Workflow Manager from http://go.microsoft.com/fwlink/p/?LinkID=252092Instructions for Installing and Configuring Workflow Manager: http://technet.microsoft.com/en-us/library/jj193478.aspx

So, now we understand the flavours, let’s examine the base question which is essentially – could I/should I install the Workflow Manager on just the App Server in a WFE + App server environment, to reduce load on WFE’s?

Can Workflow Manager be installed on a SharePoint server?

Yes
1. On http://technet.microsoft.com/en-us/library/cc262485%28v=office.15%29 it’s indicated that “You can install Workflow Manager on a dedicated computer.”
2. On the topology chart at http://zoom.it/GvRG#full it displays configurations (e.g. “Two-Tier”) where it’s all in one.

Is there any benefit to isolating the Workflow Manager to the App Server?

The same concepts that would apply to standard SP2010 workflow topology considerations apply: if you are expecting heavy lifting, then offsetting the Workflow Manager to an App server is prudent.  For “high-availability” mode you would need involve Service Bus and it requires 3 servers running Workflow Manager, in their own internal “farm” network.