It wouldn't be a problem if Microsoft only used that protocol handler for an "Open in Edge" button. The problem is they use it pretty much everywhere. Search the web from the start menu? That's a Microsoft Edge link. Click a link in the settings app? It's a Microsoft Edge link. They're effectively just using the handler as a way to bypass the user's choice of default browser, which is why Firefox had to implement this work-around in the first place.

Because links are universally accepted as interoperable between all devices and their browsers. Now MS wants to create links that serve the same purpose as a regular link yet can only be opened by the edge browser.

Clearly microsoft thinks they're getting something out of it and you've already bought their license, now you're also forced to use edge even if you dont realise it or want it.

Users have explicitly told the OS that they want to use Firefox but the system deliberately defies that decision. Users have pushed back against that behavior by hacking around it.

It's not surprising that Microsoft is turning into a bully here, but I wouldn't call cynicism in general about MS being a bully to be overreacting.

Users have explicitly told the OS that they want to use Firefox and have not told the OS that for this action they want to use Edge.

The button doesn't say "Open in Edge", it says "See web results". Do you think an average user would expect that to open in their default web browser?

I believe that "See web results" shouldn't use Edge Protocol, instead of Firefox intercepting Edge Protocol.

What about stuff that doesn't really work in FF or has terrible performance and Windows/MS wanted to open it in Edge?

Yes, but it does use Edge Protocol. That's why some HN users are upset. I don't think it's an overreaction, and you seem to agree that it's wrong.

Responding to your edit: If Microsoft creates a new type of page that works well in Edge but not other browsers, they can make a new protocol for it and allow other browser to support the protocol if they want to. In fact that's exactly what happened here: Microsoft added a new protocol, Firefox said "we support this new protocol with full performance and functionality, so we should be able to open it".

Is there a "Open in Firefox" button near the "Open in Edge" button?

We’re not talking about a button like that.