I’m seriously considering going back to Linux for my next work setup.
Define "limited capacity". Other than Apple Services like iCloud, FaceTime, iMessage, Apple Music/TV, etc, it should just be the App Store that's unavailable without an Apple ID (which _is_ crippling on iOS, but not so much on macOS).
No, you can log in without being connected to the internet (that obviously happens a lot on a daily basis, where people are using a laptop with no connectivity until after they sign in).
That's right. It sounds like a bug but this is Microsoft we're talking about here. They're probably brainstorming for ways to lock you from your own computer.
You can solve this problem by creating an offline account with Admin privileges after setting up Windows with your online account, but most users won't do that.