I once was reading this thread, since I got the same problem. Despite disabling iCloud which then deletes all files, I tried all hints on this thread. A few days ago, I resolved this issue for me in another, IMHO, interesting way.
My problems started after I realized that putting 50K+ files from emails created by https://thehorcrux.com is too much for iCloudDrive. I deleted files first on macOS and this made Windows (the latest Win10 build) stuck in syncing, maybe just too many files. I then deleted files on Windows directly. iCloud Drive sync, bookmarks and photos sync worked after this for a while and then stopped syncing on Windows completely, telling me "Initializing..." Both macbooks, iPhone and iPad kept working as expected. I checked the version of iCloud on Windows : it was 14.2. After a search, I landed on this thread. As mentioned, no hints from here worked for me and I already mentally decided that a bigger work is coming since deleting the whole iCloud and related files on Windows would mean a lot of manual syncing and sorting.
Before crashing all this one me, I first synced all files on the iCloud Drive on Windows with "Syncovery" to a NAS share. All worked well, not error reported. I then thought that a second copy as ZIP archive would make me feel much better :-). I use 7-zip. 7-zip refused to create an archive from iCloud Drive, reporting that "the cloud operation was unsuccessful" in the folder "<path to iCloud Drive>/.Trash". I host iCloud Drive in my home folder on the "C:" drive on Windows which is default, IIRC. Error reports by 7-zip confused me, since "Syncovery" did not report anything whereas I asked to take the whole folder, and not only its content, where ".Trash" might be considered as hidden and to be skipped.
I wanted to see what iCloud actually considers to be in "Trash". I first logged in on iclould.com and realized that iCloud knows only two files as candidates for a recovery on Drive. On Windows, the ".Trash" folder had tons of files which I deleted over a longer period of time. Interestingly, ".Trash" does not exist in the iCloud folder on macOS, since, I think, the global system "Bin" is used for this.
I decided to clean ".Trash" on Windows completely and did this form elevated (admin) command line with "rmdir /s /q .Trash", and then recreated this folder with "mkdir .Trash" but from another command line with my regular permissions. For a while, I was busy to check if 7-zip works again, but then I quickly realized that the status window from iCloud Drive stopped showing "Intializing..." on its own and actually counted down files left to sync very quickly. Wow! 8-) It works again! Bookmarks were synced again in Firefox, and iCloud Photos showed up in a sync in Lightroom! Yeah! It is back, no hassle with file sorting!
Try this, it might work for you too. I wish some engineering folks from Apple would read this too. I can gladly send some logs if I knew which. I think some weird things happened to ".Trash" which both system did not stand, so to say ;-)
Good luck!