Kinda sorta ish if you squint a lot, I guess.
I think the main bit missing from being a "micro-VM" is the "micro" part.
There are two sides to the coin of being an OS that is adapted to being a guest.
One side, the obvious one, is that it knows it's in a VM and talks to virtual adaptors rather than emulated hardware.
The less obvious side, which is proving harder in the x86 FOSS space for now, is that a guest OS that is designed to be a guest OS does not need to do much in the way of hardware management. It isn't an OS controlling a computer: it's a program running under another OS, which (theoretically) controls the hardware.
(Theoretically because the parent OS might also be in a VM and so it isn't controlling any actual hardware either.)
Compare with the JVM. It can be turned into an OS and there have been several such efforts, such as SavaJe. But it wasn't meant to be. It has no graphics drivers; it runs under an OS with them and at best can ask that OS to display a window. It has no filesystem. It has no network drivers. It asks the parent OS for everything.
Linux as a guest, or FreeBSD or whatever, is a whole-system OS being shoe-horned into a smaller box, but people are only just beginning to embrace this. A guest OS doesn't need *any* hardware drivers, and it should not really need even a filesystem.
But they're getting there.