Why should microsoft just make their primary commercial product free for everyone? I am curious to know what percentage of MS profit is from OS sales, but I assume it's very high?

Apple can make their OS free cause they make money on the hardware, which 99% of people buy from them to run the OS on.

And of course linux and other open source is another story.

I don't think microsoft makes that much money from customers buying their OS directly, but rather from OEMs installing Windows by default on the laptops/desktops they are selling.

Never once have I met a person buying a standalone windows upgrade/windows OS. Either they end up buying a new computer, they stick with whatever was installed on their computer (hello, XP/Vista users), or they illegally download the upgrades.

They definitely sell retail copies of Windows, and someone must be buying them, or else I can't imagine the retailers would bother stocking them.

For example, a good amount of the people that have Macs also need to run Windows virtual machines (or Bootcamp), and the primary way to do that is to buy a retail copy of Windows. I can't imagine that's a very high percentage of revenue, but I wouldn't say that nobody buys Windows directly.

If you illegally download upgrades, then you're almost certainly infecting your computer with significant malware.

Do people not care about this?

I'm not a big Windows fan (I've run Linux as my primary OS for years), but I've bought several Windows OS packages over the years for work (testing software).