How does this compare with Prepar3D from Lockheed. I thought Lockheed had bought MS FlightSim and even hired a good number of their developers and that was the end of MS FligthSim https://www.prepar3d.com/
As for your second question, you're right and wrong. Lockheed got the rights to further develop the old MSFS engine, and to rebrand it as P3D, but only for academic/professional simulation purposes. So they are not allowed to sell it as a game, only as a learning and simulation tool. Here are some of the reqs from the Academic License (60USD) EULA, whereamong you'll find this : (3) in connection with Academic Education, (4) by students, instructors and staff associated with Licensee's Academic Education, .., (6) for purposes other than personal/consumer entertainment. Point (6) also appears in the EULA of the Professional (200USD) license.
Though this has, AFAIK this has been done more for corporate legal reasons than for any desire to go after individual users. I've never heard of any revoked licenses on the above-mentioned grounds.
So Microsoft has always signaled that they consider MSFS a product still in their gaming portfolio. Though people learned to cope with the absence.