Proceeded ahead and configured this. Our EWS and Autodiscover is not externally published which is why we went for the Exchange Hybrid Agent model. After completion of the wizard, we get this warning on HCW.
"Office 365 was unable to communicate with your on-premises Autodiscover endpoint. This is typically due to incorrect DNS or firewall configuration. The Office 365 tenant is currently configured to use the following URL for Autodiscover queries from the Office 365 tenant to the on-premises organization"
What is the impact of this? If we move a mailbox from on prem to the cloud, will it require a reconfiguration of profile? When a cloud user wants to query free busy for on prem user, will it cause an issue? I thought this is what the Hybrid agent should cater for. Don't get why the warning is still there though,