hi mani)) great question, and yes, u got it right! enabling 'allow trusted microsoft services to bypass this firewall' will let sharepoint online and exchange online access ur key vault keys without any hiccups. microsoft services are whitelisted, so they skip the ip restrictions like magic https://learn.microsoft.com/en-us/azure/key-vault/general/network-security
just tick that checkbox in the key vault networking settings, and ur good to go. sharepoint and exchange will keep working like nothing changed. microsoft knows their stuff, so trust the process )
now, if u ever switch to other clouds or tools, remember this trick might not work the same way. always check if the platform has a similar 'trusted services' option. its a lifesaver when u need to lock things down but keep some access open. Peek at the key vault logs after making the change. u wanna see those sweet 'success' entries from sharepoint and exchange. if u spot anything weird, the logs will spill the tea first. check them https://learn.microsoft.com/en-us/azure/key-vault/general/logging
this is a solid move for security! locking down key vaults but letting the right services in is chef's kiss. microsoft made it easy, so take advantage ))
ps: if u ever mess with ip restrictions elsewhere, test during off hours. just in case, u know? better safe than sorry :)
rgds,
Alex