There is nothing stopping it from running arbitrary applications, those applications just wouldn't be Android apps. Which is just as well because 99% of Android apps are just a bloated skin over a web page anyway.
I can't actually think of the last time that I wanted to (rather than was forced to) use a non-messaging non-browser app on my phone.
Because you need these apps to do almost anything.
I went to a music festival last weekend, ticket has to be on the ticketmaster app which is android or iOS, the official app for the festival has timings and updates for the event which are very important else you will miss stuff that is announced, even safety warnings.
My train tickets were on the app, I needed it to book the Uber as well.
20% off drinks and food if you use the paypal app. You just can't do things without Android or iOS.
Thousands of people parked in random fields, parked in daylight, need to find car at night = Airtag/ map.
Everything is an app these days. It's a lot harder to do everything without such things. You wouldn't have been able to attend without such a device.