> ”Games”: hard to say, because Windows is a better platform for games than Android by 10x.
Note that there are quite a few commercial "Android on PC" emulators already, e.g. https://www.memuplay.com/, https://www.bluestacks.com/ and https://www.bignox.com/.
In terms of scale, Bluestacks claim they have 50 million monthly active users which makes them pretty substantial! From https://www.bluestacks.com/promote-your-game.html. Overall mobile gaming revenue is now larger than console gaming and more than 2x PC gaming, and rapidly growing (https://scaletech.medium.com/mobile-gaming-statistics-trends...). Android gaming is a much bigger market than you'd imagine, especially for the younger generation.
> hard to see how it competes with the median user getting an iPhone
> This is the case with the consumer in China, where ... the iPhone is still preferred by those who can afford it
I think you're seriously overestimating how popular iPhones are, even to users who can afford them. Especially if you're looking at Windows users, Android is hugely dominant outside the US.
In China for example, iOS market share is actually constant around 20% or maybe slightly declining over the last decade (https://www.statista.com/statistics/262176/market-share-held...) despite the huge increase in average purchasing power, which makes it seem unlikely that the only thing holding people in China back from them is the price.
Globally, Android is at 70% of devices (https://gs.statcounter.com/os-market-share/mobile/worldwide) even in relatively wealth areas like the EU. iOS is primarily popular in the USA (where it's about 60% of devices). I suspect iOS and Mac usage are fairly closely correlated, so the Android percentage goes up substantially if you're only looking at Windows users. I think Android integration actually makes a lot of sense for Microsoft!