For what it's worth, I don't know any developers that have had a positive experience working directly with Microsoft. They're extremely controlling and hands-on, and everything is designed by committee and requires huge levels of executive buy-in. They are so desperate for success that everything becomes a giant exercise in avoiding risk, to the point that they don't even trust the developer they hired to make the game.
The main issue, though, is that MS is constantly changing overall strategies on a whim, and that impacts the products. Because everything has to fit the overall strategy, even if there was nothing really wrong with the original product before.
i.e. Signing a game as a single player game, then adding co-op later because the overall company strategy changed.
They also know that they're Microsoft, and they have a lot of clout and can't be easily sued. So they really play hardball on prices, contract renegotations, etc. even when they're in the wrong or drastically change the scope of a project.
For example, a friend's studio signed their indie game with MS. It was for a new MS platform, and they had to constantly renegotiate the contract to get paid. Why? Because they technically kept missing milestones because Microsoft wasn't delivering the APIs for that platform on time.