Can you just put a random 360/og xbox in you xbox one/series and expect it to run what's on the disc? What about your PC/other xcloud device? What about the digital only xbox models?
Nope, what MS calls BC is not even a proper emulation layer, it needs to download a recompiled binary to even work (on select few games). You guys are being manipulated.
Also, at its core backward compatibility has nothing to do with the medium where the application is stored, otherwise you wouldn't be able to claim your PC is backward compatible to any machine that had a floppy disc by example. Backward compatibility is about the ability to run binaries from an existing platform... Not, you get the disc, then download the program for your new system and use it with the old assets. By this definition a port of the doom engine that runs existing wads makes my ps3 backward compatible with PCs for some reason.... Well, everything that runs doom levels is Backwards compatible with the PC.
And what about that device:
plugs into your pc, run original carts for these old systems with an emulator... it's actually more valid as a "backward compat" layer.
You get the idea.