Not really, calling KVM a type-1 is a misunderstanding of what the “bare-metal” distinction is referring to. The real difference between the two types is whether the hypervisor owns the hardware or not. In the case of a type-1, the hypervisor runs below the kernel and controls access to the hardware, even for the kernel. In type-2, the hypervisor runs on the kernel, which owns the hardware, and must go through the kernel to use hardware resources.