You nailed it! M$ lives in a parallel universe where everyone have Gb connections and windows works 100% of the time, and also no one is ever doing anything important on the computer, so it's ok to automatically restart to install updates.
Anyway, I'll quote a previous reply here, to help those that still need help with this:
"(...) I found a way of downloading the installer separately, it's explained on Forza Reddit, called the fiddler method. I'll not link it here, because legal stuff, but should be easy to find. As a result, I was finally able to download FM7 demo, and eventually decided to purchase the full game.
See Microsoft, you only earned one more sale EXCLUSIVELY because of "alternative" methods to download your product. Locking is bad, learn that once and for all!!!"
I was afraid my comment would get blocked, so I didn't include the link, but wth, here it goes: https://www.reddit.com/r/forza/comments/54coxq/fh3\_redownloading\_fix\_pc/
Oh, and it works with Forza 7 as well! And just to make it ABSOLUTELY CLEAR to the M$ employee reading this right now, it is totally legal!!! It will only work if you have purchased the game.