> I wonder why Google doesn’t bother competing with Microsoft in the flight simulation niche.

Because the competition is already fierce. There's MS Flight Simulator and X-Plane on the commercial side, Flightgear on the open source side and geo-fs.com on the free-to-play side.

There is not much Google can actually gain from making their own flight simulator.

"If you land correctly at Kai Tak you get emailed a job offer from a major airline" could work.