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I have a custom domain addy as my DEFAULT address (always send/reply as, unless I change it). Most times sent mail shows as from this address; occasionally it shows as "on behalf of."

My exchange account is primary (I'm assuming, I've had a hellofa time figuring out how I set all this up in the first place). It is the ugly outlook address, but it also has a friendly version that displays as somename@ outlook.com. I can't really remember where that came from other that during some step/conversion/whatever I had the option to create something easier to use/remember (maybe converting an outlook to exchange address or visa versa, idk). I don't use it for anything other than pulling in email (or currently, to forward private domain email to it since pop is all messed up). It's my primary inbox, and all mail delivers to that inbox. I prefer this to having multiple inboxes and I use categories to easily spot accounts (or I did before those broke too). In outlook desktop accounts it's listed as exchange account, (everything else is pop). Generally (if not always) it displayed the friendly address. Post outlook melt down it's bouncing back and forth between ugly and friendly.

Side note: I've actually used this my friendly outlook email a few times to send myself something. It's either delivered no problem, or has an error message "ugly outlook addy doesn't exist" or something like that.

Now, Outlook mobile shows the inbox for my DEFAULT (private domain) account, but it syncs with my ugly or otherwise outlook account. At one point after the melt down I tried to add my friendly outlook account to it, but it said it was already connected (which I guess I already knew). I always assumed the mobile inbox displays as my default email because I don't have the "send/reply as" option there.

I'm thinking this makes little sense. I'm pretty sure at one long-past point, it did 😅

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I also noticed in desktop, my exchange account keeps bouncing back and forth between presenting as outlook_xxxxx... and the user-friendly email address removed for privacy reasons.
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Is the friendly address a grandfathered custom domain or a 3rd party address? You should only have the outlook_ugly address when non-ms hosted accounts are set as primary.

But... tonight I set up a new VM and added my Microsoft account as a connected service in Office. I have the custom domain address as primary. When I added it to word, it came in as one of the outlook.com addresses on the account. This is the first time I've seen that happen.