It came bundled with a stripped down version of Windows 2.x - missing the application launcher (in Windows 1.x/2.x known as MS-DOS Executive, replaced by Program Manager and File Manager in Windows 3.x), so it could only be used to run one application (Excel) unless you fiddled with its configuration.
Yes it needed DOS because pre-3.11 Windows versions actually used the DOS kernel for all file access. When 32-bit file access was introduced in WfW 3.11, that was no longer true-but it was an optional feature you could turn off. In all pre-NT Windows versions, Windows is deeply integrated with DOS, even though in 9x/Me that integration is largely for backward compatibility and mostly unused when running 32-bit apps - but still so deeply ingrained into the system that it can’t work without it.
IIRC, Microsoft tried to sell the same stripped down single-app-only Windows version to other vendors, but found few takers. The cut-down Windows 3.x version used by Windows 95 Setup is essentially the 3.x version of the same thing. Digital Research likewise offered a single app version of their GEM GUI to ISVs, and that saw somewhat greater uptake.
