You seem to miss the point. People aren’t disagreeing with you about that. The point is that this is wholly within control of Microsoft, and has nothing to do with the EU. It’s Microsoft choice how they implement it, just do it in compliance with the rules.
No, MS has software that can bugcheck the kernel (JIT, etc.) which would require them under EU law to open up that control to other software vendors. Without that software malware would be able to get root access and destroy a system without Windows ever being able to do something about it. You NEED kernel level protection (Windows defender) in order to stop that. But then the EU says "Windows defender is like Norton antivirus (etc), so MS must open up the access to other software". And that is the issue. Windows defender should be seen as a part of Windows, and a required component of the kernel. But the EU disagrees with that.