I would transfer OS and MSFS to m.2. The OS would start faster (if you cares about it) and will not occupy too much space. Also, the MSFS would have more space for the next 10 years of updates and addons.
All the other programs and app should be installed at your ssd.
But if you choose the 500gb m.2, I would let the OS at SSD.
Keep in mind that, maybe, if you buy a SSD with integrated RAM, you could buy more space with less money compared to m.2