The contracts for the Steam Machine were already locked in before RAM and GPU shortage even started, which means they will (like other consoles) be able to provide a reserved amount of devices at a fixed and lower price. But likewise, this also means that for any console that did not have contracts locked in before shit went down, will suffer massively from this. Thus looking at current prices for hardware isn't indicative of how much prices will rise. Steam Machine could be the most affordable gaming device of the next decade.
But Valve also isn't stupid. PC has the unique position where it has one of the longest backlogs of backwards compatible games and applications. Which means you don't need top of the line hardware. People are still gaming on 10 year old PCs, so the hardware for those will be much more affordable and still be able to play most games. Especially indie games with their insane price to performance to quality ratios. If top line gaming on PC becomes economically unviable, it will simply move down a notch.
I mean, your post says "Forcing windows down Xbox gamers throats". So people that are already in the locked down Xbox ecosystem, not people that already know that and avoid Xbox. Xbox is just Windows but locked down. It's both Microsoft.
I completely agree people should just go for a PC, but if someone was buying Xbox already, they aren't in the mindset. So if they're going to buy Xbox anyways, having a device that's not locked down to some console OS means they can switch at any time and rid themselves of Xbox, since it's your device. To me that's definitely an improvement over the status quo, even if other better options were already available.