Does this over count because I think good chunk of Linux people (including me) have dedicated windows or maybe old windows machine where they play some of the games that are unplayable on linux. Also double boot is something that would be common in situations like that. In such case, I think this should be higher a little bit. Or Am I missing something?

I don't think this should over count because the steam hardware survey is done once per account each time.

It just depends if you're booted into windows or into linux when you have the survey popup.

It is an indicator but far from real imo. Percentage of users that participate in the survey could be different across different OS too.