Using classic Outlook for Windows in business environments
Ron,
I also thought Outlook 2016 supported modern auth but unfortunately that is only for M365. The Outlook Team had to go look at the code and confirm they only did the 2FA with App Password support for Outlook.com.
One way to confirm is to look at the Connection Status Dialog, Description of the Connection Status dialog (press Ctrl, then right click the Outlook icon in the system tray, click Connection Status). Even with the reg keys to enable ADAL and MSOAuth Outlook still connects with Authn=Clear for Basic. It should be Bearer or MSA for modern auth.