Salvida - Good question,
It was actually both which I am sure was confusing. This is the sequence:
1) Microsoft Store updated my iTunes version to the newest version. I had problems immediately following that update.
2) When I spoke with Apple they suggested I uninstall the Microsoft Store version and do a new install directly from the apple.com/itunes site. That also did not work - same issues occurred.
3) I uninstalled the new Apple/itunes version 12.12.9.4 and tried to install an earlier version prior to 12.12.9.4
4) While the older version was installing it halted the install stating it was not compatible with the current itunes library file. I would not allow me to continue so I cancelled.
5) I re-installed the apple.com/itunes 12.12.9.4 version again in order to access my library and use iTunes at least partially until a fix can be pushed out.
I hope that helps with the sequence.
Also in reference to backing up my iphone, I did not do that. My iPhone and iPad have no issues with playing, removing and adding new files to my library.
One thing I am suspect about is Genius. It may not be the issue but when I update genius on my itunes it takes an extraordinarily long time to update whereas it did not before. You can't turn off Genius if you have other devices synced to your library which in this case I have a number of devices synced so I haven't tested that theory. My synced devices are (iPhone, iPad, AppleTV, Car)
Hope that helps -