CountMike :
That's pure paranoia, I have and use Microsoft/hotmail account for years and there's no negative experience, no adds, just many perks that come with it.
OK, I keep my tinfoil hat over there on the bedpost. But the telemetry issue with Win10 is real. And I have gotten some (so far polite) ads showing up on the lock screen when resuming from sleep even though I thought I had killed that in settings (need to re-look).
Logging in TO THE COMPUTER with an MS Account triggers the full load of data collection. Logging in to an MS Account via a browser doesn't do that, and the connection is broken when you're finished and log out again..
If you really like Cortana then you have to sign in with your MS Account whether you like it or not, and Cortana will need access to everything you do with the computer (full telemetry) to work the way she's intended to. That's phone-level management and data collection, which we expect on our phones. Just do it with eyes open. I for one do not demand that in my home computer, where I expect some smidgen of privacy. And my internet connection and data cap are much happier with the MS traffic under control. YMMV
Activation works fine without the MS Account. If the AU (which has yet to make an appearance around my house) makes hardware changes easier to activate with MS Account login active in the computer, great, but that's a niche most of us won't peek into much; so far, I've had no problem activating any of the 4 computers W10 has gone into though admittedly I haven't changed a motherboard since about Win7 SP1 rollout ...
-M