That they'd change the content is the point—offer malware content for select targets, with corresponding malware checksums that are consistent with that malware and its entire history.

Those checksums would seem valid to the victims, as they're a self-consistent history of checksum trees they got directly from GitHub. The devs would be working with different checksum trees. GitHub would maintain both versions, serving different content and different checksums depending on who asks.

This seems to boil down to them keeping two repositories - presenting one to the logged in dev, and one to the public.

That might work for a while if dev isn't active. He would, for example have to not notice there was a new release, with an incremented version number that triggers updates. Even that doesn't work forever. Down stream dev's often look at the changes - for example a Debian maintainer usually runs his eye over the changes.

But if the dev is active this is going to be noticed pretty quickly. The branches will diverge, commit messages, feature announcements, bug reports, line numbers not matching up. It would require a skilled operator to keep them loosely in sync, and that's the best they could do.

Either way, sooner or later Microsoft's subterfuge would be discovered, and that is the death knell for this scenario. The outrage here and elsewhere would boil over. Open source would leave github en masse, Microsoft's reputation would be destroyed, they would lose top engineers. I don't have a high opinion of Microsoft's technical skills and leadership as they have been consistently demonstrated themselves to be inconsistent and unreliable. But the company too large and too successful to be psychotic. The shareholders, customers, and lawyers would have someones guts for garters if they pulled a stunt like that.