@Nux rebuilding the dom0 kernel is quite tricky, and I am not sure it is going to help your usecase, if you really want, you may want to look on xcp-ng-rpms and the related linux rpm
Regarding nested Hyper-V in Xen, gen2 support was considered in the past, but it never got fully implemented, see https://lore.kernel.org/xen-devel/20191130115737.15752-1-liuwe@microsoft.com/
and https://lore.kernel.org/xen-devel/20190923100931.29670-1-liuwe@microsoft.com/ for related discussion on the Xen mailing list.
So as it is now, Xen in Hyper-V gen2 vm is not supported.
Only gen1 is supported on a best-effort basis.
Gen1 use realistic-behaving emulated devices, thus there is no Hyper-V specific driver that may improve performance.