>>lostms+(OP)
This was definitely not a great experience, but my hunch is what happened is some higher ups decided no, they don't need to hire you, the original team tells recruiting to notify you, recruiting drops the ball somehow, team goes on with their lives believing that you were told they were no longer interested, and everyone (except you, since you never got notified) believed the whole thing was resolved.
The original people (not recruiters) who reached out to you should've connected after the decision was made. They probably figured the recruiters would do their dirty work, so no need to engage.
Full disclosure: I worked at Microsoft for over a decade, so I know how slow and lumbering it can be. I bet some emails were missed and people didn't follow up because "they had a lot of other things they were tracking".