Wrapping menu’s top-level link and sub-menus in div

This would do it:

class My_Walker_Nav_Menu extends Walker_Nav_Menu {
    private $_before = null;

    public function start_el( &$output, $item, $depth = 0, $args = array(), $id = 0 ) {
        // Backup the original "before", if any.
        if ( null === $this->_before ) {
            $this->_before = $args->before;
        }
        // Now add the wrapper div, if applicable.
        if ( 0 == $depth ) {
            $args->before="<div class="sub-menu-wrapper">" . $this->_before;
        } else {
            $args->before = $this->_before;
        }

        // Then let the parent walker does the output generation.
        parent::start_el( $output, $item, $depth, $args, $id );
    }

    public function end_el( &$output, $item, $depth = 0, $args = array() ) {
        // Close the wrapper div, if applicable.
        if ( 0 == $depth ) {
            $output .= '</div><!-- .sub-menu-wrapper -->';
        }
        $output .= "</li>\n";
    }
}

I.e. Extend the start_el() and end_el() methods/functions instead of start_lvl() and end_lvl(). Also, the wrapper will only be added if the menu item has children (or submenu(s)).

Sample usage:

wp_nav_menu( [
    'walker' => new My_Walker_Nav_Menu(),
    // ... other args.
] );