Dear respected,
We went through your post carefully and do understand your concern of Word application keeps asking you to save in OneDrive even if you want them to local drive always.
If my understanding is correct, from my tests on Word for Mac 16.83 and 16.84 just now, if I save a file to local folder(by clicking On my Mac), the next time Word will save it in the same local folder automatically since Word will remember the last save location.
However, I did find that in recent months, some other users are facing a similar issue as yours. See: How do I prevent Word from saving to OneDrive? (Word for Mac) - Microsoft Community And it seems like this happens on various versions and MacOS.
In this situation, there may have something needed to be investigated further from the application side instead of end users' sides. We will report this inconvenience user experience to the related Word product development team. And for end users, we suggest use the Feedback option inside application and so you can submit with more logs and information so that the product team can locate the root cause quickly. See: How do I give feedback on Microsoft 365? - Microsoft Support
We'll update here for you as soon as we receive any updates on this issue from the product team. I appreciate your time and effort on checking these above and thank you for your time and cooperation. I hope that you are keeping safe and well!
Sincerely,
Mia | Microsoft Community Moderator