Hi PL. I'm Greg, an installation specialist, 10 year Windows MVP, and Volunteer Guardian Moderator here to help you.
You should be able to link the DL to your MS Account, then sign in to a separate Local Account you create to operate under. There is of course no good reason to do this because all it does is make it inconvenient to use MS features. But I understand some users still have privacy concerns (I am a privacy advocate) even though there is almost zero intrusion compared to, for example, Google.
Can I see the error you're getting which says you must continue to sign in with that MS Account to keep the DL linked? I think it might refer to another MS account being used on the PC which it could then switch the DL to - for example how a new owner gets the DL linked - rather than inability to use another Local Account. I've seen the linked MS Account then converted to a Local in Account settings with no loss of the DL to the MS account. Or you can use a separately created Local Account.
If you'll try the above and report back I can help you better. Activation is evolving as they push everything to the DL to better manage a billion Windows 10 users. But there are a handful of MVP's who try to keep up with this and want to know what the actual User experience is at all times.
Changing hardware procedure is here:
https://support.microsoft.com/en-us/help/20530/.... Note one recent change is that the activation Troubleshooter would make an exception (never allowed before ) to more license from OEM if all else is correct. This appears to have changed and now it again restricts moving from OEM. However you can ask Microsoft Support by one of these methods:
https://partner.support.services.microsoft.com/... as they have been making exceptions for good cause on builder's OEM since Windows 7.
I hope this helps. Feel free to ask back any questions and keep me posted. If you will wait to rate my post, I will keep working with you until it's resolved.