Decaying dark matter (DDM) scenarios have recently regained attention due to their potential ability to resolve the well-known clustering (or $S_8$) tension between weak lensing (WL) and cosmic microwave background (CMB) measurements. In this paper, we investigate a well-established model where the original dark matter particle decays into a massless particle and a massive daughter particle. The latter obtains a velocity kick during the decay process that results in the suppression of the matter power spectrum at scales that are observable with WL shear observations. We perform the first fully non-linear WL analysis of this two-body decaying dark matter (Lambda DDM) scenario, including intrinsic alignment and baryonic feedback processes. We used the cosmic shear band power spectra from KiDS-1000 data and combined it with temperature and polarisation data from Planck in order to constrain the Lambda DDM model. We report new limits on the decay rate and mass splitting parameters that are significantly stronger than previous results, especially in the case of low-mass splittings. Regarding the $S_8$ tension, we found a reduction from about 3 to 2 sigma , depending on which statistical measure is applied. We therefore conclude that the two-body Lambda DDM model is able to reduce the $S_8$ tension without convincingly solving it.