RISC-V is defined by two standards. The older user level one is pretty stable but the newer supervisor level one is still changing so many existing RISC-V systems don't implement it. That doesn't necessarily keep you from running Linux on them but it does mean they need a special port. This new product will be able to boot "standard" Linux binaries as will any future system implementing the supervisor spec.
Yes, the same company sells arduino compatible RISC-V microcontroller boards that are not capable of running Linux.
What does "arduino compatible" mean in that context?
AFAIU it means that the I/O pins are compatible with Arduino shields.
Disclaimer: I have neither a HiFive1 or an Arduino myself.
I think they mean it has a real MMU capable of memory protection and virtual memory. Earlier RISC-V cores came out before this was agreed to as a standard.
The other ones are just microcontrolers. This is the first one that is capable of running a full operating system.