As far as I know, Microsoft has never prevented Windows XP or Windows Vista, etc... from being unusable despite not supporting them and also needing an activation service.
Last year I installed a genuine Windows XP Home and was able to activate it as usual. A few months ago I installed a genuine Windows XP PRO, and it also worked fine and was able to update it as Microsoft keeps updates available even though the Windows update service for XP is no longer officially working because Windows XP is no longer supported.
Also, last year, I installed a Windows Server 2008 R2 to do some tests and remember some things, and it activated correctly with a license that I have since 2009 and had not used in years, and Windows update still worked OK.
As far as we all know, no Microsoft operating system, or Software, like Microsoft Office, has stopped working because Microsoft stopped supporting it. If that was the case, just imagine that our beloved Windows 98 stopped working because Microsoft doesn't support it anymore, In that case the name of this forum would be even more relevant and everything we do with our 30-year-old, or older, computers would not be possible.
I believe that all updates for Windows XP and later are available from Microsoft, including unsupported ones.
If Microsoft starts selling its operating system the way Steam sold and sells its games, much of our hobby would be gone, let's just imagine that we can't install Windows 7 on our retro computers in the future because the DVDs Microsoft sold didn't have all parts of the operating system and need the support of Microsoft to work compulsorily....
I imagine that Microsoft has something like a virtual machine in their servers to maintain updates and activation services for each of its operating systems.
Windows 7 Pro and Enterprise still receive maintenance updates or something like that, at least they appear to me from time to time.
XP is older than Steam I think, I'm not going to check it, because I'm almost sure.
Summary, Steam, refuses to maintain the service because they don't want to invest money and resources in it, because why they will care if they took the customer's money a long time ago, and they are not honest, because in some cases they weren't selling you the full game even if you bought it in a physical media. In this case, the game should be able to be installed and playable without problems and what didn't work should be the Steam client, because what I wanted to buy was the game, not the client I think.
They could have a separate client for each operating system they "sold" games for, limiting the functionality to that of each operating system and the games supported on each operating system.
My current impression from an EU point of view is that in the US, there is no protection for customers from abuse by big business.
I guess that's why the EU has had "little problems" with Google, Facebook, etc...
And maybe that's also why GOG and Steam are so different, despite dedicating themselves to the same thing, because GOG also sells new games that have online services, not only old games.