Hello everyone! Thanks a bunch! This is the only method that worked. However, I did it slightly differently. Since it wouldn't boot in fastboot mode while was connected to my laptop, when it started charging I connected it to the charger and let it charge 2%. After I pushed down power and volume down and it triggered fast boot mode. Then I connected it to the laptop and used "fastboot continue command". Ther is also a small software tool that's called XiaomiADBFastbootTools, it's more user-friendly than cmd from platform-tools..I don't think software update can fix that. EDL is booted straight from PBL it does not even pass SBL or XBL
so I let drain battery by holding vol down + power with hair tie for three days. it left EDL mode when battery died, and low battery icon is displayed.
From this state I somehow managed to enter fastboot mode by only holding vol down with hair tie + connecting usb to PC (low charging 500mA)
once in fastboot mode I installed android_winusb.inf and booted from fastboot.exe
Now I won't update or reboot ever and keep battery charged between 20% - 80%
You saved me! Now I can retrieve all my personal files, charge it 100% and return it to the store after I forcibly induce a deadboot and use the warranty to fix it.
What a waste of time. My trust in Poco has left to never come back, since the phone is from a May 2021 batch, and they still made it and sold it knowing it has this fatal flaw.
Thanks again for this post and my special thanks to @Alecxs.