Hi @KelMel
I have looked into backend logs and I can see that the authentication is getting failed from the Sharepoint end.
I can see that this URL call /_api/web/GetFolderByServerRelativePath(decodedUrl=@p)?$expand=Folders,Files&@p='%2f'" that is getting failed as the user does not have the required permission. As you have mentioned looks like your user need might need to have access to the root SharePoint site. Can you provide the root access to the user and reconfigure it again and see if it helps you. Looking into the GetFolderByServerRelativePath document from SharePoint end I don't see what permission needed. I have also added office-sharepoint-online tag so the team can comment on what permission the user needed for this REST call.