Microsoft can ban your Microsoft account arbitrarily so GP is right, you don't own your data anymore and Microsoft can keep it and forbid you access, regardless of encryption or not.
I don't recall every to see a post on HN that Microsoft has terminated access to some ones MS (Business) Account. I am sure someone has got their account terminated I just don't recall ever seeing a post about here.
we have seen plenty for google, Amazon, Facebook. I see no reason to think Microsoft is different. Just because we haven't heard of a case yet, doesn't mean it is not possible or that it will never happen. it's more likely just a matter of time.