From what I understand, when the directory was added VR, MR, and 3d printing were just becoming more main stream. It is easy to see why some at Microsoft believed that an easy to use modeling applications like Microsoft 3d Builder would be as essential as Microsoft Paint. With hindsight, we can see that 3d printing is still too complicated and not useful enough for the average computer user and most VR users are either content to use models from others or to use more complicated tools like Blender.
It probably doesn’t though. Obviously it’s closed source making it harder to tell what’s actually happening, but there’s nothing stopping security analysts from looking at network usage and such. I would imagine that Google doesn’t install a keylogger on every Android phone, not out of the goodness of their hearts, but because they don’t want the bad publicity and lawsuits when it would inevitably be discovered.