MicrosoftMicrosoftJoeatheist If you're thinking of licensing for just the desktop versions of the Office applications themselves, like Outlook, Word, Excel, PowerPoint via the M365 Apps for Enterprise component, keep in mind that the M365 Apps for Enterprise versions of these applications do require users to sign into their M365 account in order to activate the Office client, and that the desktop apps will present cloud storage locations to end users, like OneDrive, raising the possibility of an unwanted data spill. No matter whether you use a Commercial or GCC/GCCH tenant, if your org doesn't allow cloud storage you'd have to be careful to disable SharePoint Online licensing to keep OneDrives disabled, use GPOs to disable sharing options wherever possible, keep up to date with Office client updates that may re-enable some of the sharing functionality, etc. However if there is a data spill into cloud storage, having that data spill into a GCCH tenant instead of a Commercial tenant may be looked upon more favorably, but your org would have to balance the cost of a GCCH tenant versus the risk of a data spill.
