Assuming you did originally create the account into which you could not log in, then surely the part where "Microsoft swapped in the same subscription under a d

Assuming you did originally create the account into which you could not log in, then surely the part where "Microsoft swapped in the same subscription under a different name" was literal fraud on the part of Microsoft. That is unless the guilty party was somebody else who had created the account using your stolen card details and was making use of it.