What EGreg is saying is that most development environments and UX used to be based on Atom, while they are now based on VS Code.

EGreg didn't mean to say that VS Code used to be Atom, or is based on Atom, though I agree his wording was a bit ambiguous and it could be interpreted that way.

I took the claim ("Atom used to be the base, now VS Code is") to mean that custom DE toolchains used to be predominantly built on Atom but are now built on VS Code, not that VS Code was built on Atom. (The statement is pretty clearly saying VS Code replaced Atom as the base for something else, not that Atom was VS Code's base.)

I didn't say it was!