Multiple instances of MediaWiki on one server
Solution 1:
Use separate source code and separate databases. That way you can install extensions or custom themes in one of them without impacting others.
If you really know that you will never ever have custom extensions/themes in one but not in the other wikis, then 3. seems to be a better choice than 2, but keep in mind the upload folder (there is a setting in LocalSettings to specify the path)
Solution 2:
Mediawiki upgrades are a doddle anyway, so I run 2 totally separate instances, including a copy of the plugins directory and a copy (not a symlink) of the LocalSettings.php file. I found years ago that trying to save a few minutes on running 2 upgrades would cost me days of getting it set up right, so I just don't bother anymore :)
2 DBs, 2 code instances. Simple. you can export and import between the two very easily then, for maybe one day when you want to merge them together.
Solution 3:
A MediaWiki installation is nothing more than a directory tree and associated database. You can run as many parallel installations as you like. Any part of the file base that needs to be shared can be done so using symlinks. It only gets tricky if you want to share parts of the database and because that tends to be a one way road to disaster you would be well advised to stay clear of it.