Balmer or not, Microsoft is still in direct competition with Apple for much of its core business. So encouraging customers to buy a laptop where they get $50 for the windows license and if they're lucky another $100 in software sales, but their key competitor gets >=$1000 of profit -- yeah, it's pretty clearly a bad business choice.
Just looked at the earnings report and I have to agree with you. Windows + Office was 25% of MS's revenue in 2021, but I suspect you're right that the big majority of that is not consumer-driven. FWIW just 2 years back, Windows + Office was 40% of revenue, so this segment is very rapidly becoming less important.
