I believe a found an alternative solution which allows you to not only start MSFS but also to receive updates again (like Sim-Update 4, 1.16.2.0). With above registry hack alone, you will not receive any more MSFS updates (at least it was so on my system)!
Instead:
- Apply this registry hack (or that one, if you prefer)*
- “Reset” Microsoft Gaming Services:
- Go to Start > Settings > Apps
- Search for “Gaming Services”
- Click on “Advanced options”
- Click, in this order, “Terminate”, “Repair”, “Reset” (as explained here in more details; it is also what ZSAPN suggested)
- Restart your computer.
- Open the MS Store and search for updates. The MSFS update should now download successfully.
- Launch MSFS. It should install the update first and then continue to work with the updated version.
*) I am not actually sure if this step is necessary or if “resetting Gaming Services” is enough, but anyway I did both steps on my system and it works.