alt Hacker NewsS&box was based on UnrealEngine 4 until late 2020. I think Garry wanted to use the latest and greatest engine, then Valve continued to be friendly with him, and even though Valve wanted Source2 to be a VR platform, it was clear desktop was going to remain relevant, but the content creation tools on SteamVR Environments were a cut-down version of what was actually used to make Half-Life Alyx, but they gave Garry all the tools, and he moved to Source2, and built a .net "framework" to make it faster to develop and iterate in Source2. So Garry's tools are now an open version of the closed tools that Valve didn't want to release that they used to make Alyx.
Finally there's another serious competitor to UE and Unity.
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Good, great even. The more the better. Even if the ecosystem gets seriously fragmented I'll take this over your only real choice being UE and Unity (t. Godot enjoyer).
Yet another one. Along with Stride, Godot, Unigine, O3DE, Flax and tens more. All look like they just want be clone of UE: generic dark UI with inspector, scene hierarchy, asset browser in the bottom and play button in the top. Zero creativity and innovation. Where's Emacs or Vim of game engines which brings its own unique philosophy?
>even though Valve wanted Source2 to be a VR platform
I don't think this is true. The first Source2 game "released" was Dota 2, and currently it's used for CS2 and Deadlock as well.