[JonathonW]

WSL2 is "just" Linux running in a Hyper-V VM (with some special sauce on top of it to handle things like interacting with the filesystem or doing Wayland and X11 graphics, plus containerization stuff to allow multiple distributions to be installed and run under one VM and one kernel).

WSL1 was a completely different approach, adding a Linux compatibility layer to Windows itself. There, you never had a Linux kernel running at all-- Linux syscalls would call into WSL, which would talk directly to the NT kernel to do whatever that syscall needed to do.

WSL1 didn't last very long (still present, but not actively being developed)-- turns out that reimplementing one operating system on top of another is a Hard Problem (see also: Wine). WSL2 avoids this entirely, and also avoids most of the impedance mismatches that you get when trying to reimplement POSIX on top of NT. WSL2 solved a whole bunch of compatibility problems essentially overnight that WSL1 never even got around to.