Using a time capsule as a NAS server?

As LaPastenague has pointed out, at best you could use your TC as a media file storage device, but it does not have a dedicated operating system to run any applications or services. You would still need a host computer or an actual dedicated NAS devices to run the Plex server app. In turn, the TC could potentially be one of the media file sources for this app. Regardless, performance would be suspect as the TC was not designed for this purpose.

I suggest that you consider getting a "true" NAS, like those from Synology to be both your Plex server host and media storage device.

You can use TC as storage for videos.. but you cannot run plex on the TC.

Plex normally requires a proper x86 processor of some sort. So an old computer or the like is best. If you want to run it on a NAS and depending on if you expect to be transcoding then a NAS with a decent processor and RAM is required.

Just look up plex requirements.