I wonder if something like this could be done on Linux with xorg hackery (probably involving xvfb?). Definitely seems handy.
It could "work" in the same vein, but the UX isn't as nice as what TFA's tool is, I think.
(You can absolutely use Xephyr on a Wayland session of course, since the latter is compatible with X11 clients. But the virtual display Xephyr provides is X11.)