A thin kernel interface isn't a reimplementation of a kernel. The WALI implementation in WAMR is ~2000 lines of C, most of which is just pass-through system calls.
It does not throw away the Wasm sandbox. Sandboxing means two things: memory sandboxing and system sandboxing. It retains the former. For the latter you can apply the same kinds of sandboxing policies as native processes and achieve the same effect, or even do it more efficiently in-process by the engine, and do interposition and whitelist/blacklisting more robustly than, e.g. seccomp.