I don't like using an external drive for OneDrive. For one thing, you must never eject (or unplug) the external drive. If you do, you must go through the long re-syncing process, which for me seemed to occur too often even without ejecting the drive.
If I lack space in OneDrive, I prefer to use the "Free up space" feature and use the external drive for full periodic backups of my OneDrive.
But now I have new hardware with lots of internal space, which is ideal for making backups since all files are locally available. The old hardware does not need files to be locally available.