“Everything is a file” means that many of the system’s components are represented as abstractions in the filesystem. It’s simply an API that allows reading from and writing to it by integrating into the hierarchical file structure.

If you take a look inside /sys, you will find a fuckton of files, but they don’t represent data stored on a mass storage medium. Instead, the directory contains a mounted sysfs filesystem that contains file-like representations of various parts and properties of the system. For example, you can read them like a file by running cat /sys/block/sda/queue/rotational to check if the sda block device is a spinning disk (1) or solid-state storage (0). Or you can write to them like a file by running echo 1 > /sys/block/sda/devices/delete to command sda’s driver to detach the device. Similarly, /proc contains a mounted procfs filesystem that presents information about running processes as file-like entries; /dev contains a mounted devfs that points to various devices; and /tmp and /run contain tmpfs mounts for temporary storage in volatile memory (RAM or swap).

Windows uses various other APIs (like the Component Object Model and others) to accomplish the same that are not necessarily tied into the filesystem.