It’s generally fine, the vast majority of applications are fine with it, it’s mainly the legacy shit that falls over.
You can also enable it on a per directory basis, and I’ve yet to encounter a Dev tool that has issues with it. Same for the path limit, you can have long paths enabled too.
I thought this was dumb as fuck, but I think I understand what Microsoft is trying to do here.
What might not be obvious is that this “Windows” app is for iOS, Android and Linux - yes, it’s a replacement for remote desktop but it’s specifically a remote desktop app to connect to Windows machines.
So while I still this this rebranding is entirely unnecessary, I can see that they are trying to clearly distinguish “I’m not on windows and I need to do something on windows so I’ll use the windows app for that” .
It also means less confusion when “remote desktop” doesn’t let you connect to your Mac or whatever.