Issue with Distribution Groups Members

The issue happens because Exchange Dynamic Distribution Groups created in the GUI don’t let you filter by license status, they only see whether a user has a mailbox, so shared mailboxes and unlicensed users get included as well. If you want only active licensed users (like those with E3), the best option without using PowerShell is to create a Dynamic Group in Azure AD (Microsoft Entra). There, you can build rules directly in the GUI to include only active users with the right license. That way, the group will automatically update itself with the correct members, and you don’t have to manage it manually or worry about shared or unlicensed accounts being added.

------------------------------------
Don't forget to mark as solution if my answer suits you