Microsoft is in a huge pickle on this.
SteamOS has proven to be faster than Windows and that's knowing when the vast majority of games are running in the compatibility translation layer. There's still a lot of overhead and wins that can be gained through direct native ports and other things on the Linux side.
On the Windows side, Microsoft has to contend with bloat that goes back decades, which they compounded by turning Windows into adware that shows people the latest 99-cent deals at Amazon and now coupled with the highly unpopular Recall which is a sop to its business customers so that Windows can snitch on WFH people.
We are at a deep inflection point here. It makes perfect sense to have a dedicated gaming OS just for the purpose that is significantly leaner and tailored for that consuming audience.
If Microsoft really wants to push what is running on the XBox into a little bit more of a general use, they have to know that that's going to eat away at Windows itself. Would that make XBox OS into a sort of a distro? If they're going to keep to the mainline Windows, what are they going to do about the built in advertisements that Windows is now larded up with? Are they going to have to ditch Recall so soon?
Kind of seems like Microsoft can't serve two masters here. They have to pick one and lose the other. Business or gamers.