Based on video previews of Windows 8.1, I recently wrote a short piece on the newly added Wallpaper Persistence and it's effect in organizing and spatializing the OS.
Now, having used the update for some time, it's clear that this effect is even more apparent—and important, than it seemed at first blush.
By allowing boot directly to the desktop, the desktop itself now truly appears as the base layer, the space in which all OS elements live. Desktop icons are, as they have always been, above the desktop.
The tiled Modern UI now also effectively functions as a desktop overlay (as I had always thought it should). Desktop icons simply disappear when the Modern UI is triggered, a simple and effective solution. Desktop icons and windows, as well as the tiled Modern UI start menu, are now effectively hierarchically equal, side by side overlays, as opposed to hierarchically ambiguous, separate UI's as they were in Windows 8.
When a Modern UI applications is launched an animation is triggered in which the tile flips outward and expands to fill the screen, suggesting that Modern UI applications live in a another layer above the tiled Start Menu. This does help maintain orientation, but the connection here is fleeting.
Notification overlays (low battery, Windows Update, etc.) work as well as they always have, the horizontal stripe making it intuitively clear that action needs to be taken before proceeding. This recalls the experience of unwrapping a well packaged garment, where you must remove the cardstock band to access the item inside.
Additionally, Modern UI apps still feel significantly overscaled on a large external monitor (My real world use of Windows 8, and 8.1 has almost exclusively been on a 24" 16:10 monitor). Defining a max Y height could improve the experience, focusing content toward the center of the screen vertically, while reducing certain elements (images, body text, etc).
I expect that Modern UI apps are not seeing heavy use on laptops and even less on desktops. Combined with Surface RT's slow sales (and Windows tablet sales as a whole?), Modern UI apps are likely not gaining the screen time that Microsoft had hoped. The strategy of a hybrid OS, leveraging the existing Windows user base to promote exposure to and development of Modern UI apps, may be failing. Lack of users begets lack of developers begets lack of users, ad infinitum. Improving the experience of Modern UI apps at larger screen sizes is a necessary step to reverse this trend.