Yes! But I work on CodeSandbox, so that creates some bias :). We've been working on our own CDE solution, though we've taken a different spin to improve speed and cost.
Our solution is based on Firecracker, which enables us to "pause" (& clone) a VM at any point in time and resume it later exactly where it left of, within 1.5s. This gives the benefit that you won't have to wait for your environment to spin up when you request one, or when you continue working on one after some inactivity.
However, there's another benefit to that: we can now "preload" development environments. Whenever someone opens a pull request (even from local), we create a VM for it in the background. We run the dev server/LSPs/everything you need, and then pause the VM. Now whenever you want to review that pull request, we resume that environment and you can instantly review the code or check the dev server/preview like a deployment preview.
It also reduces cost. We can pause the VM after 5 minutes of inactivity, and when you come back, we'll resume it so it won't feel like the environment was closed at all. In other solutions you either need to keep a server spinning in the background, or increase the "hibernation timeout" to make sure you don't have the cold boot.
It's kind of like your laptop, if you close it you don't expect it to shut down and boot the whole OS again when you open it. I've written more about how we do the pausing/cloning here (https://codesandbox.io/blog/how-we-clone-a-running-vm-in-2-s...) and here (https://codesandbox.io/blog/cloning-microvms-using-userfault...).