I agree with point 3, but points one and two don't make any sense because games have been skipping with Python scripting for decades and this is never a problem. The python interpreter is embedded into your program as a library and it doesn't have any dependency on the whatever python version the user installed.
It's the dependency hell problem as packages are added to the sandbox environment. If they were just shipping python (standard library), it would be fine, but all of the useful libraries have large numbers of dependencies.
It's not hell because they carefully curate the set of libraries rather than having end-users attempt to have every combination of packages (and then blame microsoft for the dependency hell / lack of support for their exact configuration.).
You say this as a good thing... but as a data scientist that uses python every day I can assure you their "carefully curated set of third party libraries" definitely will not include most of the libraries I rely upon for my work.
> games have been skipping with Python scripting for decades
That only works if there is a forever fixed version of Python embedded in your game. The value of Python in this context is its ecosystem and folks will need to install additional packages and libraries into the execution environment. Now you're managing a local distribution of Python.
Yeah, but if the big value is supposed to be in the libraries you sort of have to accept dependency hell? Otherwise you're in the world where a small set of libraries can deliver all the functionality ever needed.
Of the currently available solutions, "cloud environment made by Microsoft" doesn't sound that different from "software update made by Microsoft" in terms of how it solves the dependency hell: basically, the critical library you need is either in or out, but there is nothing you can do about it.
Admittedly, here I'm assuming Microsoft won't let you install things into the environment yourself since that basically means hosting virtual machines running arbitrary code and putting the Excel brand in front.
Dependency hell may be an issue if you install arbitrary libraries into the container at runtime. Note that this feature isn't currently available in the preview.
On versioning: we freeze the container image that your Workbook was authored against. You need to manually accept (and validate things continue to work) updates to that container image as we roll forward.