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hi baz,
we've communicated with the related engineers for your situation. currently, of the issue that we cannot open documents in client applications by default in the new onedrive for business interface, the product team is already aware and is working on a fix. we'll update here when the fix is deployed.
the following workarounds are for your reference:
- click ... next to the document > open in word.
- after opening the document in the browser by clicking on the document name, click edit document > edit in word at the up-right corner.
- return to classic onedrive. admins can also temporarily switch back to the classic onedrive for business experience for the users at sharepoint admin center > settings > onedrive for business experience > classic experience.
thanks for your patience and understanding.
lingyu sun