It's an interesting idea, I've never tried it. It could also be a simple VM running a given OS (with reduced need for hardware support), or an application running interpreted code with the environment UI.

Generally the idea is to expand UX in more interesting/fun directions without incurring significant hurdles associated with an OS (where everything needs to run reliably and be secure).

I've found this quite interesting related discussion: "Classical "Single user computers" were a flawed or at least limited idea" https://utcc.utoronto.ca/~cks/space/blog/tech/SingleUserComp... (discussion on lobste.rs: https://lobste.rs/s/plkdy5/classical_single_user_computers_w...)