Dear PDENNISM,
Good day! Thank you for posting to Microsoft Community. We are happy to help you.
As per your description, please let us cooperate and please don’t worry, we can work together to narrow down and resolve the situation.
It seems that that the problem only occurs after updated to iPad OS 16. And you use an Apple Pencil, to take advantage of iPad Scribble functionality to write text.
Please make sure if Scribble is enabled on your iPad **Settings (**make sure that the switch next to Scribbleis enabled).
If all setting it correct in your iPad OS, then try to perform reset OneNote troubleshooting steps for iPad and check it make any difference.
Reset OneNote on your iPad:(Before Reset OneNote for iPad please note make sure that all notebooks are synced or have backup in case of any data loss)
a. Ensure that the OneNote app is closed.
b. Go to Settings.
c. Find the OneNote app you want to reset.
d. Select the app.
e. Scroll down to reset OneNote app (Delete Sign-In Credentials and turn the toggle on).
Make sure OneNote is not running. (Double tap the home screen to see all running apps and swipe up on OneNote to close it.)
Re-open OneNote and you will have to sign in again. Once done, please check if you can use apple Scribble function in your OneNote.
Since, your Apple Pencil setting all are correct in your iPad device and reset and uninstall/reinstall OneNote app doesn't work and still issue persist, in this scenario to report this problem/bug, we requested you please send/provide the feedback via Microsoft OneNote feedback portal to related development OneNote team so that they can get notice about it, and it will fix in next updates version. of OneNote for iPad. It’s the best way to report to related Office development team and we are sure it will speed up this process. Your advice is very important to us.
I again really apologize for this because its effort on your daily work.
Your understanding and patience will be highly appreciated. I hope that you are keeping safe and well!
Sincerely,
Waqas Muhammad