If you stay in the happy path, it's decent, better than it used to be. Microsoft does seem committed to it, they're slowly converting Windows apps to WinUI 3.
That said, the team is clearly understaffed; there are long-standing unresolved bugs, just search for "memory leak" on their GitHub issue tracker. Also, native, non-.NET support is definitely an afterthought, it's barely documented and the tooling is super awkward. But at least, unlike WPF, it exists.
To remain compatible with Android and iPhones they removed or simplified a bunch of features, ironically stripping out HDR support just when practically all phones got wide gamut and HDR, OLED screens, etc.
In the era when mobile phones are getting amazing, Microsoft is still racing towards the bottom along with every laptop maker other than Apple.
There's nothing wrong with Win32 (and everything wrong with the newer stuff); "interaction latency" was just fine on a single-core 33MHz 486 running Windows 95.