From an office perspective, I suggest you add this ~/windows/ directory path to the Trusted Locations.
Please go to Excel > File > Options > Trust Center > Trust Center Settings > tick the box of "Allow Trusted Locations on my network", then click Add new location, then tick the box of "Subfolders of this location are also trusted".
For the permission of folders, these such issues are out of my support scope, as the tag "office-excel-itpro" focus more on general issues of Excel client. Thanks for your understanding.
I personally suggest you could try to use icacls tool to see the permissions on %APPDATA%.
The reference thread, please checkout "Can any user access the %APPDATA% folder".
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