I also thought that it might be worth trying the new Microsoft Defender for Mac as part of my Microsoft 365 family plan. That was an EPIC Fail too!!! It installed ok but is falling into that trap of not recognizing that fact that I do have a valid supporting 365 account! Will they ever get anything right on MacOS, or are we just destined to friutlessly continue the struggle? They are pushing this through Office 365 and proclaim that it works with my Microsoft 365 family plan, or am I just getting it all wrong here?
UPDATE: I'm told, in another forum, that this particular issue may be due to a platform outage of some nature. If that is true it's going on a day at least so far! They may also want to look at improving their client side messaging here. Having customers bounce off an authentication wall without telling them truly why only creates confusion and frustration!