Folders Shared with me are syncing as internet shortcut in OneDrive on Windows PC

After months of having this problem, I can give you some pointers.

It seems that there are two versions of OneDrive Personal. The folders on the PC only work well between accounts with the same version.

Without warning, some accounts change versions, so from one day to the next they can no longer use that folder and it becomes a simple link.

On the OneDrive website, in options you can identify which version of OneDrive that account has. There are many differences, but I am attaching a screenshot to quickly identify if you are on the new or old version.

Microsoft would have to migrate everyone to the same version, and it would have to be a process of a few days, but it has been having this problem for 9 months now.

We want a solution now!!

I've explored every possible solution to fix this issue, and I can confidently say that most of the usual troubleshooting steps won’t work. If you’re lucky, removing the link and re-adding it using the Add to OneDrive button might help, but reinstalling OneDrive is unlikely to make a difference.

From my experience, this appears to be a server-side permission issue. I encountered the same problem with another account and analyzed the requests made to the server along with their responses. The key indicator is the sharing status in My Files on OneDrive Web—working shared folders are marked as Shared, while shared links show up as Private. Additionally, I’ve noticed occasional errors stating, "Permission Denied. The user may have stopped sharing, or the sharing might have expired," even when that’s not the case. So the server side issue is the most probable explanation.

Oh and one more issue is that we cannot use copy or move buttons to copy the files from Shared folders in affected account to the Personal Folders in OneDrive web. Guess why, the account does not have permission.

This raises two possibilities:

1. Microsoft may be restricting folder sharing from paid accounts to free accounts (though that’s not my situation, as all my accounts are paid).
2. Some change in OneDrive’s backend might have unintentionally introduced this issue and they are not going to fix it since its a small number of people and not worth their time (Seriously!)

We can either wait for Microsoft to fix this (which they might not) or move to another provider. Another solution is to create another account and hope that it work. No need to reinstall OneDrive or look for upgrade or anything else. Its not worth the effort

The solution is Dropbox, Nextcloud etc.

Microsoft, are you fixing this or are you just pretending and trying to push us to share point or other providers. Please give us an update on this asap. Its not right that you havent engaged with us.