Love this feedback, agree with you completely on all of it - I'll be making those changes.
1. In comparison with colima with krunkit, I ship smolvm with custom built kernel + rootfs, with a focus on the virtual machine as opposed to running containers (though I enable running containers inside it).
The customizations are also opensource here: https://github.com/smol-machines/libkrunfw
2. Good call on that description!
I've reached out to you on linkedin