the tiny ruler that decides which program gets to touch the actual hardware
means The central, essential core of something — literally a seed or grain inside a shell, and figuratively the innermost part that everything else is built around (including the core of an operating system that controls hardware access).
from From Old English 'cyrnel,' a diminutive of 'corn' meaning 'seed' or 'grain' — so a kernel is literally a 'little corn,' the small hard heart hiding inside a nut or fruit. That same Germanic root for grain gives us 'corn' itself and is a distant cousin of Latin 'granum.' The computing sense is much younger, borrowing the old image of the vital seed within the husk and applying it to the small core program nestled at the center of a system.