It's strange that MS has never did what Apple did with the OS 9 → OS X transition, starting with a fresh foundation and making a clean break from the predecessor by way of a well-integrated "Classic" mode that seamlessly runs legacy applications in a "borderless" VM.

The most natural time to have done this would've probably been going from XP → Vista/7, which broke a number of old things anyway.

For all that switching mainline Windows over to the NT kernel in 2k/XP improved Windows, the benefit wasn't as great as it could've been if they'd been able to unshackle the OS from backwards compatibility with all the preceding Windows/DOS stuff.

Windows 10x was rumored to run Win32 programs within a single-combined container for backward compatibility purpose too.

Keep in mind that Apple didn't have much to lose, in the years leading up to OS X they were scrambling for market share lost to Windows 95, and already in a frenzy over a failed modernization attempt (Copland) that was intending to maintain backwards compatibility. They were truly desperate, on the verge of going bankrupt under a "corporate rehabilitator" CEO with no Steve Jobs in sight.

Microsoft had a good thing going, with the massive success of MS-DOS and Windows 95 it was imperative that the next generation consumer OS, Windows 2000, could run programs from their existing well-respected platform without users noticing the gap. (With OS X, you noticed the gap -- totally different UI style when in Classic Environment, and the Carbon API for easy porting was a mess that went unadopted by developers)

Windows 7 had that "XP Mode" feature where it would try to run things in a VM, but it was an unloved stepchild.

Really, they could have done a lot better-- a VM jukebox with everything from DOS 3.3 onwards available could have made the "most compatible Windows ever"-- even old software that assumed a 4.77MHz CPU clock could have been rigged to run natively.