I think it should be more nuanced and better directed than it is today.
For example, Nokia X or other AOSP phones shouldn't be anywhere near the Lumia's key markets, i.e. U.S, India, Brazil, UK, Germany, etc. Unfortunately, Microsoft/Nokia released the X-series in some of those markets, only serving to confuse the market with two similarly priced and spec'd phones, but with the X being crappier (performance wise). This shouldn't have happened.
That said, the value of an AOSP phone can't be understated. The idea of using a widely used platform to push Microsoft services and software is a good idea, but this needs to be done in a directed manner.
For example, Microsoft could create a range of AOSP phones, from low-end to high-end, and exclusively release them in China, no where else. Chinese companies are heavy users of AOSP, each offering their own line of services, skins, designs, etc. Microsoft could take AOSP and create its own version as both a full device offering as well as "OS" that could be taken by other OEMs. This would make sense for China precisely because that's how the Chinese market operates.
However, there shouldn't be any Nokia X or AOSP device in India, or Vietnam, etc.