On the other hand, Microsoft has been trying for years to get developers off win32 and onto .NET. Windows S mode was an experiment where they didn't support win32 at all. Much of .NET is already open source. One could argue they are ready to make a .NET shell around a linux kernel and ship MS Linux.

But ... why would they? The only reasoning I can see is if they could stop maintaining the windows kernel, like how the move to chromium means they have one less thing to maintain. But they have to keep maintaining it for all those enterprise windows deployments which are tied hard to win32 apps. So I think there's nothing here but clickbait. And yes, I clicked.