Outlook 2016 doesn't accept password or app password

I left a comment yesterday because I was having problem connecting a new employee mailbox (Outlook 2016 desktop to 365 hosted mailbox). I did everything possible (reg hack) even when it does not apply to Outlook 2016 but still couldn't get the new mailbox added into Outlook 2016. The error says something like "we can't add the account right now..." (not the exact words).

This morning I continued to troubleshoot the problem but didn't succeed so I gave up, again.

About an hour later, the user sent me an email. She said she was able to use Outlook 2016 to access her mailbox. That tells me the problem is on the back end. I did nothing on the PC to get Outlook 2016 to connect. It didn't connect earlier and suddenly it connects successfully. Whatever it is you guys are doing is the source of the problem.

Yes but if you're using an app password you aren't using modern authentication.

Still broken. Going on three or four weeks. Why am I paying for a service that doesn't function, Microsoft? And what credit will I receive for the period in which it doesn't function?

From not the community member:

If the cases just as the picture which is in the first post which was logged via the Windows, will set the MS email account in the windows directly help?

Because at least, the outlook 2021 will list the accounts under the For other apps, select Add a Microsoft accountor Add a work or school account.

https://support.microsoft.com/en-us/windows/add-or-remove-accounts-on-your-pc-104dc19f-6430-4b49-6a2b-e4dbd1dcdf32#WindowsVersion=Windows_11
To make signing in to your accounts easier and faster, you may want to add accounts for different apps. 

To add an account used by apps to your PC:

1. Select Start > Settings > Accounts > Email & accounts.
2. To add an account used by email. calendar, or contacts, select Add an account under Accounts used by email, calendar, and contacts. For other apps, select Add a Microsoft accountor Add a work or school account.
3. Follow the prompts to add the account.

(The outlook 2016 msi way install might need updates January 2024 PU
KB5002096 https://learn.microsoft.com/en-us/officeupdates/office-updates-msi 

And some regedit is suggestied
https://learn.microsoft.com/en-us/exchange/troubleshoot/administration/modern-authentication-configuration
It is recommended that users force Outlook to use Modern Authentication by setting the DWORD value of the following registry key to 1: HKEY_CURRENT_USER\Software\Microsoft\Exchange\AlwaysUseMSOAuthForAutoDiscover)

It's no good after all. In fact, the situation is even worse today.