"Variety is the spice of life"
Sadly this isnt going to change imo, because of Gamepass, and them viewing xbox as a service.
It actually could. Microsoft never really said they're doing away with Single player games necessarily, it's just that they want to focus on multiplayer games specifically. Now Multiplayer service games aren't the only things they should release. But there's nothing wrong with them being the killer app or selling point. With more studios under their belt, Microsoft could provide a very diverse library.
"Obviously you can't make every game a blockbuster"
Yes, you could make every game a blockbuster, but I don't think that's actually a good strategy. It stifles creativity and after a while all your games look and play very similar because of it. Case in point, just look at how homogenized so many of Sony's recent first party games have been.
Now I do agree that Microsoft needs to have more patience with their developers and give them the budget needed to make the game they want. But I don't think mandating them to spend as much money as possible to make their games needlessly big is good idea.
"Keep them Xbox exclusive"
They even talked about putting Halo on competeing platforms (ei. playstation)
Xbox is a brand of Gaming platforms run by Microsoft. It doesn't have to be a console anymore, it can be a service on PC, or a streaming platform you can access from your phone. The goal isn't to get people to buy a console per-se, but buy and ecosystem, and make sure they're locked into it fairly with compelling exclusives, and great services. If I buy an Xbox exclusive, I should only be able to play it on an Xbox Console, xCloud, or the Xbox on PC platform. As for the competing platforms thing, Companies kick around ideas that they never follow through on all the time. I think the most we'll see come out of that is maybe the Halo Trillogy and xCloud coming to Switch, and that's it.