The user-mode kernel is a port of the Linux kernel to the Linux system call interface rather than to a hardware interface. The code that implements this is under the arch interface, which is the internal kernel interface which separates architecture-independent code from architecture-dependent code. This kernel is a full Linux kernel, lacking only hardware-specific code such as drivers.
It runs the same user space as the native kernel. Processes run natively until they need to enter the kernel. There is no emulation of user space code.
Processes running inside it see a self-contained environment. They have no access to any host resources other than those explicitly provided to the virtual machine.