Fedora Asahi Remix. Considering how the M1 has no official Linux support, it's impressive that it runs as well as it does, and they have compatibility hacks to run Steam games and get Widevine to work. There's still a lot of rough edges however, like no microphone (should be coming out soon though) or fingerprint, aarch64 software support is second class and tends to have more frequent bugs (cough Electron cough) that get ignored by package maintainers and some (even FOSS) software isn't supported, I don't think high refresh rate is supported yet, full disk encryption isn't supported (but there's blog articles from people who figured out how to set it up), limited distro options, worse power efficiency so gets hot faster (just got a cooling pad to deal with this, get a Pro if you can so you have a fan) and battery life is barely different than what I've heard from Framework users so there's not really much to gain atm. Currently only supports M1 and to a lesser extent M2, and also the fact that you're dual booting makes the soldered overpriced SSD space even more limiting.

As far as distro support goes, Fedora Workstation is the only distro that has official support. There's other options with community support but there's a higher likelihood of stuff being outdated or not packaged (i.e. Arch Linux ARM doesn't have the same level of community support as normal Arch Linux). I haven't tried NixOS or Guix System on M1, but I use Nix/Guix on the Fedora install. aarch64 Guix packages keep breaking making it annoying to update and issues tend to be ignored (also certain core packages don't like the tmpfs 16k page size so you need to make it use /var/tmp instead), aarch64 Nix is a lot better but support is still slow to where Signal is several versions behind and has been broken for weeks despite there being multiple pull requests with fixes, and both Nix/Guix prioritize x86 over aarch64 for builds so it will need to compile a lot of things from source.