Modus

Because it's not a real lightning wallet and it doesn't transact through the actual lightning network off chain. 

Are there drawbacks to this approach? Why isn't it more common?

It is self-custody, it has an emergency kit and a recovery code.

Muun holds the entire balance on a non-custodial basis, regardless of whether the funds were received on-chain or via lightning.

All funds are stored on-chain with 2-of-2 multisig security, where the user has control of both keys.

Muun use submarine swaps to send and receive lightning payments.

Submarine swaps are atomic swaps that maintain the total non-custodianship of the funds.

https://blog.muun.com/why-not-just-a-mnemonic/

bitcoin

Explain Muun wallet like i'm 5

It is self-custody, it has an emergency kit and a recovery code.

Muun holds the entire balance on a non-custodial basis, regardless of whether the funds were received on-chain or via lightning.

All funds are stored on-chain with 2-of-2 multisig security, where the user has control of both keys.

Muun use submarine swaps to send and receive lightning payments.
Submarine swaps are atomic swaps that maintain the total non-custodianship of the funds.

More info: https://blog.muun.com/why-not-just-a-mnemonic/