Personally speaking, Microsoft have always been arrogant enough to not actually think that anyone is competition.
Microsoft are the magpies of the software industry, stealing the 'bright and shiny' things that other people do, and sticking it into their bloatware.
No doubt they would have looked at some of the things Amiga did well and incorporated it into their software, as they would have done with Apple, but as far as any conspiracy theories that Microsoft actually had a hand in destroying Commodore, I think thats a load of crap.
Commodore and the Amiga were a nothing to Microsoft, even with far inferior hardware, the PC was already dominating the hardware market.
I simply believe that Commodore were never 100% aware of what they had with Amiga and its future potential to expand and become more than the A1000 was in 1985.
The fact is, no matter how successful Commdore were or were not, the writing was on the wall for custom hardware by individual computer manufacturers. The PC norm of using 3rd party hardware was really starting to catch on, and today, even consoles today have more in common with PC's and their off the shelf hardware, than they do with the custom hardware of their predecessors.
Even if Commodore were successful in 1994-, to survive, they would have had to have gone the PC route. The PC was starting to dominate like nothing else, an unrelenting juggernaut. The Amiga would have become nothing more than a PC with an Amiga inspired bridgeboard to appease the diehards.
Commodore died because they didn't read the markets properly, didn't release AGA a lot sooner than they did. AGA Amigas should have been released in 1992, the height of Amiga ownership and software sales, this would have really prolonged the Amigas life, so that Commodore could have released the fabled AAA Amigas.
When the AGA Amigas were released, the PC was already ahead, Commodore lost the initiative, and never regained it.
From then on, Medhi Ali and co simply milked the company dry before it died, because now their premier product was behind, and they had nothing to compete with.