Ok.
Remember that an auction that begins with an opponent opening 1N (I will assume strong 1N for the purposes of the discussion) is fundamentally different from an auction that begins with partner opening the bidding and RHO overcalling 1N.
In the first case, a useful working proposition is that the high card points that LHO and partner hold are about the same. If 1N shows roughly 16 and you hold 10, then partner and LHO will hold, on average, about 7 points each. So you are outgunned on points.
While many pairs still play that a direct double of 1N is a big hand (i.e. suggests penalty), that is low frequency, and sometimes partner's hand disappoints. So many pairs prefer to use a defensive scheme that sacrifices the ability to show a big hand by using double to show something else... a one suited overcall, for example.
Accordingly, while the traditional meaning of a direct double of a 1N opening was 'penalty', relatively few tournament players still use it that way.
Now, consider how the points are likely to be distributed if partner opens and you hold 10 points after RHO overcalls 1N. Give partner, say, 13 (yes, partner may have less, but partner won't always be minimum) and overcaller 16. You hold 10. That leaves LHO looking at a solitary Jack, if he is lucky
So, when we hold a 'good hand' and partner has promised opening values, we rate to have the opponents on the chopping block, and now is the time to weild the axe.
Yes, when we have a stiff or xx in diamonds and partner opened 1
♣ (and we open 1
♦ with 4=4), we may once in a while find the opps running a bunch of diamond tricks, but this is very rare, in my experience... and when it could happen, sometimes we run our tricks first and sometimes they run to diamonds and we find our contract.
Playing 1N doubled with 16 points in our hand and none in dummy is a terrible, terrible experience on most occasions. As the LHO with the 10-11 hcp sitting over the 1N overcaller, it is our sacred duty to allow the overcaller the full joy of this experience
As for 1y [1N] 2z: this is weak... to play. It has to be. There will be hands on which we hold a reasonable, but not strong, 6+ suit and few hcp. Do we really have to pass 1N? We likely won't beat it because our suit isn't that strong and we lack side entries... plus dummy will have a few points to help declarer. Meanwhile, maybe we can make 8 tricks in our suit.
As for 1y [1N] 3z: this is preemptive. If we have a good hand, especially with a long suit suitable, in the absence of known fit, to bid at the 3-level (forcing, no less) then we have entries outside of our suit and/or a running suit. We should be doubling! Since we will be doubling on hands where we can make game on power (+1100 beats +420 by a LOT), we exclude these from the meaning of a jump to the 3-level. Since we are jumping to the 3-level on a relatively weak hand, we need a LOOOONNNNNGGGGG suit (typically a 7 card suit) with some internal texture, but not many hcp. KQ109xxx would be typical, with nothing outside... or QJ109xxxx with a little shape. Frankly, it is not a call I have made or seen made very often.
There will be the very rare hand on which we can reasonably expect that doubling 1N won't be as good as bidding our own game. We may have a massive one-suiter and side shortness, with the opps white and us red. We can, if we are confident in our reading of the hand, just bid our game. More commonly (but still very rarely) we will have a 5-5 or better two-suiter, with values. Most experts would use the 'impossible' bid of 2N to announce this. Impossible, because if we expect to make 2 or 3N with the opps on lead, surely we are going to crush 1N.
'one of the great markers of the advance of human kindness is the howls you will hear from the Men of God' Johann Hari