Chat Control is not law. Of course there are some people inside the EU pushing for privacy violation, just like there are everywhere else, but it's not law. For now, the law protects privacy, and Microsoft violated it. That is the issue at hand.

That's a separate problem.

And it's not "The EU", but really one EU commissioner. Many organs of the EU including the EU Legal Service have criticised CSAR (Chat Control) and the European Parliament has voted against it, effectively killing it.