In an AMA last year Bosworth said that they offered Google to have flat apps on the Quest but they wanted to limit it to that and not allow VR apps AFAIK ( they are making the money with the VR apps, so they most likely won't give that market away ) and Google wasn't interested.

For gaming it's not an issue but if they ever want to sell people on the idea of it being used for productivity, that flat android app market would be a big factor. They have recently started their own toolkit to build/convert regular android apps to HorizonOS so they maybe hope to beat Google at their own game, but we'll see how that turns out