In the scenario that I describe, Qualcomm is disinterested in x86, it just wants maximum profit off the purchase. Very much like Oracle basically shitcanned all of Sun Microsystems' products and squeezed Sun customers hard.
Keep in mind that the outlook for Intel products is not that rosy both short- and mid-term. They will certainly not go back to commanding historic margins in the datacenter. Also they lost trust from both institutional and private customers in how they handled the Raptor Lake voltage problem. Whether these customers come back anytime soon is doubtful.
Also on the manufacturing side, Intel foundries are bleeding money, 20A is cancelled, and 18A is yet unproven. So making back the purchase price off the usual business would likely take a looong time.
Yes, it is possible that Intel's patents on their instruction sets and on emulating them are all invalid, but Qualcomm is the kind of litigious company that seems determined to find out. (Their patents are also the presumed reason why Qualcomm is basically the last major vendor to offer AV1 hardware decode in their processors)
It is also possible that the EU blocks the merger but in the current political climate, the EU has become something of a vassal of the US. same politicians who pressure for replacement of Lina Khan will also exert pressure on the EU.
> MediaTek, Samsung, and Rockchip already make consumer ARM laptops
Yes, but them not being able to economically emulate newer x86 instructions would be a major sales point for Qualcomm Snapdragon. They could basically capture all the customers which are dependent on x86 software.
> Qualcomm's biggest advantage in the PC space was their exclusivity agreement with Microsoft for Windows on ARM but that is already dying at the end of the year
I think you got that backwards. The exclusivity was the precondition for Qualcomm to become interested in the Windows on ARM. Otherwise they would not even have bothered to release products specifically for that tiny market. It is Microsoft who desperately needs to become independent from x86.
> Qualcomm really did dump billions into Intel just to stop making their processors and it was allowed, how is Qualcomm going to get their money back at all let alone better than squeezing Intel normally without first killing its main source of revenue?
Qualcomm will continue to sell x86 processors, just like Oracle continued to sell SPARC processors, for a while. But they would wind down the x86 business and try to capture locked-in x86 customers onto (high-margin) Snapdragons, and they have all the ingredients to make this happen. And they will have the patents both on the design and manufacturing side to at least cause serious trouble for competitors.