Window Build ≥ 14393 has fixed this issue.
Before Windows Build 14393, softlinks in WSL looped endlessly, whether making a softlink from WSL to the main Windows C: drive or within WSL.
Former (now fixed) example from WSL:
ln -s ~/Users . cd Users cd Users cd Users cd asdfasdfffas (a non-existent directory) pwd $HOME/Users/Users/Users/asdfasdffffas