Processes in Microsoft 365 for setting up Office apps, redeeming product keys, and activating licenses.
Hello Joey,
First the error you provided above is expected when you tried to make changes to the users who were synced from local AD, as the changes need to be done from AD then sync to Microsoft 365 Azure AD/Exchange Online.
Since you have set up the attribute "msExchHiddenFromAddressLists" in local AD, my understanding is you still have active on-premises Exchange server in your local environment, please clarify if I misunderstand your scenario, thanks. Generally if the AD account (******@contoso.com) has this attribute set to True, with mailnickname set to User, and mail attribute was set to ******@contoso.com, the msExchHiddenFromAddressList should also be synced to Azure AD side, please double check the attributes above in your local AD.
Also, as far as I know if you are using AAD Connect Sync, the attribute "msExchHiddenFromAddressList" was not synced by default, and we need to enable "Exchange Hybrid" in the AAD Connect Sync to make this attribute synced to Cloud side, please double check if you enabled "Exchange Hybrid" in your AAD Connect if you are using. if so, in this case please open the Synchronization Service Manager from your AAD Connect Sync server > Metaverse Search > Connectors > double check both connectors ( on-premises AD and Azure AD ) > check if you could find the attribute "mxExchHiddenFromAddressLists" with true there. For your reference
If you could find this attribute in both connectors from your server manager, in this time, please connect to Exchange Online PowerShell and run Get-Recipient ******@domain.com | FL *HiddenFromAddressListsEnabled* to see the result
Please feel free to let me know if you got any further updates, thanks.
Best Regards,
Oliver