I started having this issue today after foolishly deleting a profile on my PC which the game was initially installed. I did a good deal of troubleshooting, reading posts from various places about this issue. In my case, this was a re-install and I had already set a 5Mb/s download limit while I was playing the game. I ran some packet traces, disable some TCP IP Auto-Tuning, and even added dead end routes to the Azure servers involved thinking maybe the Azure servers (220.127.116.11 and 18.104.22.168) were having issues. However, I found that those two IP’s are it, you stop those, you get zero updates. So, I started searching for how to disable the bandwidth limit setting because the game will not load far enough to get past the update screen.
I took a couple tries, but, ultimately, following these steps, seems to have dislodged the setting for now. To clarify for others, in my case, with MSFS 2020 closed (Not running at all in Task Manager) I removed the folder as written, then started MSFS 2020. It threw an error but did load the Accessibility menu. With that menu showing, making no changes, I re-enabled my wifi (Disabled following the steps), then clicked “continue” which took me to an ominous looking screen about licenses errors, with only an option to Quit, even though I had re-enabled my wifi once I was at teh Accessibility settings screen. Anyway, when I clicked quit, it tool me back to the XBOX login, where I clicked sign in/let’s play. From there, it went right back to checking for updates and so far, no more download looping issue. I’ve gotten almost 1GB just while typing this, so, in my opinion, MS owes LockedFir76798 a bunch of money for doing their job for them.
As a note, I will never, and I mean, never purchase anything else from the MS store. This is the first and LAST, absolutely ridiculous.