I'd wager there's something enforcing that distinction such as licensing rules for products you might have access to.

But, ultimately, those licensing rules may be under MS's control as well. Even if they aren't, it sounds like it has a significant impact on their service's design and usability, so it's in their interest to make a change somewhere.

Your 'work/school account' is managed by your work. They can close it at any time, and you would no longer have access to it. Your personal account via the same email address is an account you created with Microsoft. Even if your work/school take away your email address, that account will still exist (just that if you no longer have access to that email you won't be able to retrieve password resets or whatever for it).

It doesn't matter. A collection of roles/claims are associated with each account, resulting in different authorization profiles.

Just merge them into a single collection and have my experience be dictated by that merged collection. With how entrenched they are with the Enterprise world, they should have foreseen this scenario and designed their family of products to facilitate this seamless merging of authorization rules across disparate accounts.

This.

Because user stories aren't: "I want to access my Office365 work account" or "I want to access my personal Microsoft account".

They're: "I want to edit or download a file I have access to in the Microsoft cloud" or "I want to find a file I have access to".