Microsoft could stage a comeback one way only that i can see. (this gen)

From here on out turn the xbox one s and x into a PC. 

Include microsoft office with every unit and push it as a PC/Gaming for school and work. Maybe even package a monitor keyboard and mouse.

If they massively advertised online and retail with back to school type mentality they might sell alot of units.

For $500 if you could run Windows/Steam on it .... yeah they would sell a lot, given the size of the unit as well is shockingly compact for a 6 TFlop piece of kit.

Dual boot to windows.... and have access to normal pc programs.... yeah that could be cool.

Microsofts own hybrid console.... its also a normal pc.
I could see that appealing to some.

It'd be a bigger boon for Windows than Xbox, but a boon for Microsoft nonetheless.

Making an all-in-one device is some risky territory. If it were really that simple somebody would have done it by now. I think their best move would be to start optimizing the hell out of Windows to make it the perfect gaming platform and then rebrand Xbox's as affordable compact PCs that run Windows and have all their games built for Windows.

so kind of what you suggested but with a different approach

I have an easier solution, MS buys at least any two of the following: T2, EA, Activision, Ubisoft, Square Enix.

They have the money for it.

Microsoft Office - the best Xbox exclusive yet!

This is exactly what Microsoft needs to do. This is their strong suit against Sony and Nintendo. I think they ruined their conference shoehorning in underwhrlming games due to the way they got backlash at the XBO reveal. However, they could have really stole E3 if they would have focused more on Xbox Play Anywhere, Modding and Development on Xbox, and Windows OS.

Xbox can not compete with Sony and Nintendo on games, they need to look to what makes their Platform more valuable in other ways. The OP is on point, this is the one way they can increase the market share of thier internal hardware development.

They could make a comeback with a $99 price point.

Ahem. Cough. Cough.