Files-On-Demand status on OneDrive for Mac is confusing

Setting the scene: I'm on an M1 MacBook Pro, MacOS Sequoia 15.5, OneDrive for Mac v.26.017.0126.0002 (standalone)

Mystery #1:

Okay, so I've got a folder chock full of large files (all neatly placed in nested subfolders, of course). This one folder totals about 400 GB, in fact. For obvious reasons I had set that folder to be cloud-only by electing it and choosing 'Free Up Space' from the contextual menu. It took a while to unload all that data but eventually my finder window showed '900 GB available' instead of '500 GB available', which is what it has said previously. Great. 

Except that when I looked at the actual folder in ~/Library/CloudStorage and used Cmd-i to 'Get info' on that folder, the info window said that the folder size was… 400GB. The third party disk analysis tool Daisy Disk also reported that folder as being 400 GB in size.

Surely if the files have been released back to the cloud and only placeholder 'stubs' remain on the local file system, that folder should have a much smaller size. So what's up?

Mystery #2:

I want to make a cloned copy of my Mac for backup purposes and I want to include my OneDrive content in that backup (in case the Microsoft OneDrive servers explode, or get overrun by fire ants, or something). I know that there's no point backing up the placeholder stubs — they've got no real data in them (or do they? See Mystery #1) so I select that big old 400GB folder and select 'Always keep on this device'. The menubar icon shows activity, and I can see the individual files downloading if I click that menubar icon. About 20 hours later (because 400 GB) OneDrive finally reports 'Your files are synced'. And the Finder, sure enough, tells me that I now only have 500GB available, not 900 GB.

HOWEVER, that folder, and each folder and file inside that folder, has both a 'downloaded locally' checkmark icon (dark grey) AND a 'in the cloud' icon (cloud with a downward arrow in it). Cmd-i (Get info) on one of the subfolders reports a theoretical size for that subfolder of ~230 GB but with only 11.4 MB on disk. 

If I click on the cloud-with arrow icon then OneDrive seems to redownload the file or folder-and-contents. At least I assume that that's what it's doing; this time the OneDrive menubar icon does NOT show activity, nor do any files show as being processed/downloaded if I open up that menubar window. But whatever the process is, it seems to take about as long as I would expect the download to take and the cloud-with-arrow icon turns into one of those 'time-remaining' icons that looks like a pie chart being filled up. So far I've only done this with small folders as an experiment, because if I'm right about what's going on then that 230 GB folder is going to be showing that pie chart icon for a LOOOONG time. 

So WTF is going on? If 'Always keep on this device' hasn't actually downloaded the full-fat versions of my files then what the heck was OneDrive doing all through the night and the whole of today? Pretending to download it just to mess with me?

Do I actually have to download it twice?

Can somebody either explain how and why this is the way that OneDrive is supposed to work (I can't believe that it is), or tell me what I'm doing wrong, or suggest a solution? Or even just confirm to me that I've not gone crazy?