Can't remember a single problem with the described setup and I've been using the internet since dial-up was the only option available.
Getting hacked when you don't have any open ports (thanks to NAT) is and was pretty unlikely - what was more likely is some kind of drive-by exploit in Flash or IE. The biggest problem I experienced with old Windows was general instability in the form of BSODs and driver compatibility problems.
NAT was for fancy-pants with multiple PCs.
The CD-ROM I had was pre-SP2 (so no firewall), and our internet setup was basic modem + switch. No router with “drop invalid state” or fancy things like that.
So, installed Windows and plugged in Ethernet to fetch Windows updates.
2 minutes later, with no user interaction whatsoever, the PC was infected with malware.
Gates, is that you ? They have telemetry in PCs those days, you know. /s
And, for reference, updates are not forcefully installed on Windows Server.
Well, forcefully restarting a server without asking its owner does sound like a bad idea. And disrespecting the users in that way when the competitor OS for servers is free, has significant market share and is known for letting the user to what they want and getting out of the way should probably also be avoided from a market perspective.
Servers I understand because they're exposed to the Internet at all times. Not PCs