The entire arc is a snake eating its tail.
HWR exists because Loki became a time god who replaces HWR and lets the multiverse exist. Loki became a time god because HWR invented time travel, won the MV war, created the sacred timeline which stops the more evil Kangs from existing and killing everything forever. But HWR allows Loki to basically train to take his job.
Because Loki allowed it. It always existed, branches happen when free will exists. With the sacred time line and HWR controlling it via the TVA, no free will. Everything preordained up until HWR is killed. He gets killed on purpose, the loom explodes and Loki’s time slipping begins since he is the only god outside of time. He learns everything about physics over centuries, trying to fix the loom in order to let the multiverse exist but the loom isn’t capable of doing that. Scaling problem. A machine built by a man cannot contain infinite branches and a multiverse. It’s also designed to delete all timelines that aren’t apart of the sacred timeline. It’s a failsafe that forces Loki to come back to the time where HWR dies.
HWR offers Loki his chair to do things how HWR did it; maintain order and the sacred timeline. That or Loki just lets the loom blow up, branches go off, but the loom deletes them and resets everything and everyone at the tva dies but HWR just rebuilds it. Loki goes back to talk to möbius and sylvie and makes his own third option; free will.
Loki isn’t a man. He’s a god. So he basically became a loom himself fixing dead branches and connecting the entire multiverse. He sits by himself holding everything together in order to allow free will to exist. Free will exists so multiple branches of timelines can exist. Multiple branches = countless variants of hero’s and most importantly Kangs can exist. HWR helped Loki get as far as he could so he can also ensure that if the loom is gone, the multiverse does exist, but so does infinite kangs. The multiverse war happens and HWR wins it leading to him sitting at the end of time again. Reincarnation, baby.
Simply put; HWR = Dictatorship. Sacred time line. No free will. Everything is planned and allowed to happen as long as zero KANG variants besides Victor Timely exist.
Loki god of stories/multiverse = free will. A giant tree of life filled with branches and timelines flowing around each other. But also incursions as timelines run into one another. Timelines where we get x men, spider men, but also infinite kangs. Infinite kangs meaning HWR just needs his one variant that won the multiversal war to exist so he can do it again and turn the multiverse back into the sacred timelines it’s confusing but trust, it will all make sense.