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Exactly what gamers want after dropping $60 on a game, more ads.

If this is seemlessly integrated product placement that is SUBTLE and contextually part of the gameplay experience, then its fine.

Gen Z can spot an ad a mile away. Just, don't.

Eh, that's an over-generalization. I don't think a whole generation can spot ads. I thought so about my gen (millenials) and lots of people my age don't really understand sponsored content, for instance
knowing microsoft, they'll fuck up by doing everything people hate about ADs

if it is subtle and match the game (part brands in a car game, sponsors in a sport game, real world brands in a contemporary games), i guess it is acceptable, just like with movies, AAA games cost a lot of money to create, so if it can help reduce the risk associated with making them, fine

anything else = f word

one must not forget, you build art, and you have a reputation to protect if you want to last, i guess microsoft gives no shit about its reputation anymore anyways

imagine seeing ADs in old paintings