If you asked engineers to do a large amount of manual testing, they would either (a) tell you they were and then secretly automate it, (b) simply not do it, or (c) quit.
Turns out many kinds of businesses/product teams (including Microsoft's Windows team, I'd say, from personal user experience) need dedicated QA people because many worthwhile tests can't really be automated well enough with a reasonable effort, or if they can, it's something that often breaks and needs regular maintenance.
I suspect that in the Windows case they simply stopped testing those troublesome cases.
In 2014, for most divisions, the SDET role was rolled into the function of SDEs, reportedly resulting in drastic attrition of the converted SDETs. The exception was the operating systems division, which was reported to have laid off all of its SDETs at that time.