As I understand, progressive here means that it will work as an ordinary website even if the extra features like Service Workers aren't supported by the browser.

For me progressive should mean, that features (like adding to home screen, push notifications...) reveals progressively. Visitor should show some engagement, before PWA start to offering those features. Definitely not on first visit. It's very trendy nowadays, but extremely annoying to cancel all those feature request popups. "Do you want to receive push notifications?", "Please install our app for better experience", "Add app to homescreen" ... That's not web I like. And yes, I do realise it's far from original definition.

I was under the impression that the Progressive part of PWA meant Progressive Enhancement.

I have a PWA that creates html/css in the build process. If JS is enabled, it acts as an SPA. If JS is disabled, it's a simple static site. If ServiceWorker can be used, caches the html/css I built which both the SPA and static site versions can use. If no SW, then fallback to AppCache/LocalStorage/etc.

The hardest part was finding a CSS framework that doesn't use JS and still can do menus/etc nicely.