Microsoft keeps making it harder for consumers to set up Windows with just a local account. For the privacy conscious or other use cases, especially when using the Pro edition, it should be possible.
Build 22616 RSS
Microsoft has released Windows 11 build 22616.100 (KB5014650) to Insiders in the Dev and Beta Channels. It does not add anything new and is a cumulative update to test the servicing pipeline.
Microsoft has announced that Windows 11 22H2 Insiders on the Windows 11 Pro edition will now require a Microsoft Account and internet connection during the initial setup of a personal use device.
Microsoft has released build 22616 for Windows Insiders, it mainly contains fixes and improvements and no new features. The company also warned that the window is closing to switch channels.