I had the same problem not being able to send an email , and it recently started. I discovered that it had to do with aliases and was able to correct it.
When you start to compose an email, check at the top to see what the sending address is(the offender). Click on the "From" and it will show aliases. Choose the main email or an alias that will work.
I set a primary alias (not my outlook address) years ago and it has always worked. It is now not listed as an alias but still shows up in the From field. I did put it back in as the primary alias, and everything works as it used to. But I have not figured
out how to get my main microsoft email address to automatically come up in the From field.
If this is your problem, you will probably have fiddle with aliases to get it work the way you want it to.