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I am naive in this area, but if the creditors freak out, what does that mean? Seems like a "freak out" would mean higher interest rates, and when those rates cross the return from the cash stockpile, they just would stay paying down the debt more aggressively?

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Sure; it's just that we're talking about spending the cash stockpile. Microsoft has $126b "in the bank" but that doesn't mean they could actually spend all $126b on some moonshot, because by the time they'd spent half of it it would affect their interest rates and they'd have to start doing something about their debt.

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