I'm not familiar with patent legalese, but from my layman skimming of the patent application, I think you're right.

Instead, the patent would cover running object detection/classification ML models — optionally on remote servers — on screen and audio output and user input of specific applications (particularly videogames), without requiring cooperation from the application, to target ads based on what's happening in the application and to decide when to interrupt the application with an ad.

To hazard a guess: Microsoft or part of Microsoft is planning to include pervasive targeted advertising in the next Xbox console OS, including during gameplay of any game.

I’m experience windows 11 which is my first windows experience since maybe NT 2 or 4.

I can tell it’s still windows but I’m shocked how many things I have to turn off to stop live data from the internet appearing in my GUI. Also my profile settings, saved passwords, and other data seems to reset unexpectedly cause some or all settings to disappear. Finding stored passwords is also surprisingly difficult or impossible depending on I don’t know what.

Adding such overt spying to this mess of an OS achieves a new low in user experience.

I love the absolute fever dream that is looking at the pictures of patents. The out of context fig 9 is amazing

Yes you're right, that's my bad. I interpreted the "audiovisual" wrong. They are actually just monitoring the screen and system audio.