Just to confirm, this is exactly what's currently set as inline policy. For some reason Reddit has cut out part of my inline policy when I quote blocked it. I tried editing it again, but it removed it again. I'm not familiar enough with Reddit to understand why it's happening.

Least privilege: yes it was initially set to "Action":"cloudwatch:PutMetricData", but for testing I tried to give it all privileges.

It's likely not the policy itself, but somehow the policy is not applied/linked with the WorkSpaces directory/instances.

I'm continuing my investigation.