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I did try a lot of different things so I'm not sure what did the job, but I'm playing at Performance Mode with music on High and after "turning the game off and on again" ambient music now plays. I'm currently in England, maybe Norway is bugged and if you doesn't fully turn off the game - since Xbox has Quick Resume which keeps the game running on background when you turn the console off - it will keep silent.
@vampirekitty109 I'm playing on Xbox Series S and I have this problem where no music plays in game at all. Only menu music plays and that's it. As of right now I'm at aprox. 20h game (all after v1.0.4) and no more than 5 minutes of music even tho my settings in Music Frequency is at High... it's totally kills the vibe.
Also, yes, Reddit has a post with 2600+ upvotes from a week ago (and others with the same subject but less interactions) bringing this issue up but it isn't even listed to the Known Issues thread in the forums.