Windows Ameliorated does not require installing from an ISO. That was merely made for convenience, and for those without the basic technical knowledge required to perform a manual amelioration. There is detailed documentation for performing a manual amelioration, it uses fully open-source scripts, and is legal if you use a license key before running the scripts. (https://wiki.ameliorated.info/doku.php?id=documentation_21h1)

I do agree removing Windows Update does pose some security risk, however I don't think said risk is nearly as bad as some make it out to be, and I personally think the benefits of Windows Ameliorated greatly outweigh any security downsides.

Also, AME does greatly help to mitigate the attack surface of Windows:

Windows Ameliorated ships with a non-administrator user account by default, which mitigates ~70% of Windows vulnerabilities. (Source: https://web.archive.org/web/20210618023509/https://www.beyon...). Of course you can still do admin actions, it just requires the admin password.

The irony is that Windows is literally all about Bill Gates trying to microchip you.

There are adults old enough to drink in the USA who were born after Bill Gates stopped being CEO of Microsoft.

It has all of the SSU and cumulative updates since 21H1. But anyway I doubt they put anything in there, should be easy enough to look at the scripts on the ISO or just patch it yourself. The ISO is just an 'easy' way to distribute it.

If this is the most viable alternative, what does it say about the official version?

It isn't, so nothing.

What more viable option achieves the goals of this project?

There seem to be a lot of scripts like [1] which basically have the same result, strip all the bloat and "spyware"...?

[1] https://github.com/farag2/Sophia-Script-for-Windows

A WFP firewall like simplewall (by henry++, not the corporate one) can block everything by default, including services like Windows Update, and is IMO the most straightforward option.