Started xbox with new microsoft password - Everything works except audio: NO sound

Hi, if you're using an HDMI connection try going to settings/ console settings/ display and turn off display discovery.

It is an xbox 1 model

Pdp gaming headset

No stereo adapter

We have walked through all the audio settings and cannot figure it out we have googled it and checked everything in the Microsoft community and cannot figure out why the gaming sound suddenly start the chat works but no sounds from the game are coming through

The Internet is purposely vague on what we LOSE when we do a factory reset.
Saved games?
Video captures and screenshots?

I created a backup on one of my external drives, but that specifies what it INCLUDES and EXCLUDES, but never mentions either of the above.

There are SO many bugs in the Xbox One Settings menus:
Under General Volume & audio output:
It constantly says that Headset is connected on the right, even when NO headset is connected at all. (UPDATE, THIS WAS DUE TO THE CHATPAD USING THE 3.5MM PORT)
HDMI audio lets me THINK I am changing it to anything other than Stereo, but it keeps resetting to Stereo (regardless of what Optical audio set to).
^^Turns out this glitch is caused whenever a 3.5mm plug is inserted into the controller, even when that plug is just an extension cable; tricking the controller and the Xbox One into thinking a headset is in use. Instead of actually saying something to that effect whenever I try to change other options, or even just graying out those options with an explanation of why, it let me think those were valid options that were just not sticking.

Once I can test the in-game chat again, I will give my findings.
UPDATED IN ORIGINAL POST

I am not using beta build.

I have not tried using Wi-Fi; I am connected to my gateway with ethernet.

How would a different W-Fi make a difference on the issue I have described in detail?

The two links that you shared prove that you do not understand what my issue is.

Let me know how it goes with each one.
Maybe one of the two makes a difference

If maybe the issue persists I can advise you other 2 things

A. Do a factory reset for the console but keeping games and apps
Go to settings > system > console info > reset and then select keep my games and apps

B. Perform an offline update for your console. In that way Xbox system will be installed/updated from scratch.
For this you need a USB and PC to format it and transfer files provided in the link below (with detailed steps and requirements):

https://support.xbox.com/help/hardware-network/...