Sync SharePoint online in a on-premise shared server

Question

Hi,

I'm asking this question mostly to get recommendations and knowledge, as I know this setup is a terrible idea but I want to justify why.

I have a customer who uses Sharepoint to store all shared files. However, they also have (I think a relic from old on-premise days) a replica of Sharepoint in WS AD locally. It seems like the configuration was made using OneDrive's client with the WS Administrator account to sync some folders from SP online and share them over the LAN, so all files are available to users in LAN without having to go to SP.

Users connect to the server via RDP so they access to the SP's synchronized data only via the server and not by a shared folder in LAN, and also permissions from SP differ from those locally. They said that this setup was made because they had an app installed on the server which required sync files to be locally and not in cloud, so previous IT department made this "hybrid".

I want to introduce the best practices in this environment, and also migrate to new servers, but they want a good reason to understand why this setup is wrong so they can approve the migration and not repeat it in the new server.

Any suggestions?