I remember for years (and might be true to this day?) Call of Duty used to have id Tech 3 in the opening credits. Even though the engine was completely re-written by that point, some parts of the netcode and rendering was still technically Quake 3 code.
Honest to god this is probably the best way of describing it using "Source 2" at this point.
Source 2's entity system that is already well tested and works as-is? Replaced with components because somehow bolting Unity parts on is easier than just using Unity.
Source 2's amped up baked lighting system that makes for beautiful visuals with low performance penalties? Completely gutted, could be part of why the game has insane performance demands.
Source 2's new audio system that allows for amazing layered soundscapes via visual graphs? Also completely gutted with no clue why, maybe Garry can't wrap his head around graphs so no one can.
Source 2's physics engine that people were excited to see in future games after HLA's release? Gutted so hard I've seen people that bought s&box asking where the new water physics they saw in Source 2 went.
Source 2's networking system with modern basics like prediction and lag comp? Too complex for them, they threw it out for client auth, it's on you to stop cheaters now ok.
Source 2's radically updated version of Hammer that makes mapping way easier than ever before? You will use the scene tool and you will like it, asshole.
At this point the only shit in here that's Source 2 is I/O and rendering and they're probably itching to gut that too seeing as s&box already switched engines two or three times during development (which explains the not-unity tooling, most likely). Could be fun for people to start asking Valve if this counts as lying to customers given Facepunch already labeled this v1.0 when they are still doing work on it that should've been done years ago.