>I can do what you suggested for WAN2 MPLS - which means i need to use Virtual IP correct?
You don't have to use Virtual IP. If you use Virtual IP then all communications will go out NATed from that IP instead of the IP address configured on the MX WAN interface.
>The LAN IP is routable to the internet. Will that help? if I use Virtual IP on the LAN IP as well?
No. The WAN interfaces must have Internet access.
>Also what does "Use MX uplink IPs" mean? in what scenario do we use this?
That means it uses the IP addresses configured on the interfaces when talking to the outside world.