It's easy to knock them in retrospect, but around the time MSFT was making the decision to produce original shows, the Xbox platform was accounting for a healthy proportion of total Netflix watch time. MSFT believed that this was a key differentiating factor, and that it presented Xbox the oppprtunity it needed to win the war for the living room as a total entertainment console.
In hindsight, we see how that decision looks naive. Xbox was always about the games, and the Netflix consumption was incidental. But original programming wasn't a completely stupid idea on its face back in ~2008-10, or whenever it was. In fact, it's possible they could have succeeded; they just never seemed to be able to get the studio off the ground.