At last a smart move
Win32 APIs with modern UI is what we needed all along. It's basically the logical evolution of WPF and you can optionally get package and permission support for better store integration I suppose.
Even though none of that makes much sense when looking at it from afar it's actually quite a natural evolution.
Win32 and WinForm
WPF and XAML
UWP XAML modern UI, package and permissions
WinUI has goodness from all of the above
Microsoft app development is just a very slow moving behemoth and you've got to wonder what's taking them so long to execute. I guess that's the price of success and backward compatibility.
As of writing C# WinUi is basic but usable. Multiple windows works as far as I can tell. Use CsWin32 for your native calls, you will need a lot of them for doing even basic things like changing the application icon. However XAML UI designer is one or two years away apparently, which will be annoying if you are designing complex UI. For basic apps it's fine though.
Biting the hand that feeds IT
