kumarmukesh MuhammadatM365 Correct. I am running 2.6.1.0 and have observed this behavior. All my existing accounts continue working fine after the tenant level switch is set but if any new account are set in AD with an extensionattribute AFTER the tenant level switch is active, the user's sync is blocked with error ExchangeManagedAttributeProvisioningBlockedForTenant. The new account is never provisioned in 365 even with blank extension attributes.
To get around the block I went into the sync rules and transformed them to another attribute for the time being and am writing it back to the proper extension attribute in exchange online with an automation account script.