I have M365 Family and a domain name not on GoDaddy

We have most of our domain working with the Premium email. We can send emails and recive email using our domain (somewhat). But we have a few questions/notes...

1. When trying to associate my email address "Create address" it just appears to hang. Is this because I am using the same email address as I am logging into my Microsoft Account with? It goes to "Validating address..." then just goes back to the same question, see screen captures below.
   1. When sending emails, the from email address that everyone sees is some strange long string, i.e.
      1. ******@myDomainName.org via outlook.com  or
      2. My Name<outlook_******@outlook.com>; on behalf of; ******@myDomainName.org; (My Name via outlook.com)
   2. What happens to emails sent to users that are NOT setup in the system. I have been sending test emails, and would expect a bounced back email "this user or email address is not a valid address". But the email never bounces back.

Have MS now removed the option to add a custom domain to the Office 365 Family UK package? as I don't see it under my premium settings anymore.

UPDATE

The update was about personalised email, not domain

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I received an M365 Update notice in November saying the feature would not be offered after Nov 2023 but existing use could continue. It didn’t say for how long. I am very disappointed as it was a key reason for me signing up for Family 365.

I can still see the option on my account...

Everything I read it is around until 2023-11-30. After that it still works, but you can't add a new personalized custom domain email address.

So I got my MX records value and set everything up in the control panel of my domain registar. Exactly like puppydawgy stated in a previous message. When setting it up in outlook.com it recognises the domain (yeah), but you need to configure something in godaddy. So without a godaddy account (and domain) this trick didn't work for me.