"Your recipients couldn't be given access to the file" - Sharing via Outlook from OneDrive

Hi,

I recently made a change to the Default sharing options in SharePoint/OneDrive via our 365 Admin Centre. And since then, whenever a user in our tenant attaches a OneDrive file to an email as a Sharing Link via the Recent Files button, the email sender gets an instant email response from Outlook saying "Your recipients couldn't be given access to the file" + [long GUID]. The sent email is still received, and the recipient is able to access the email. But getting the error message is making my users question whether the system is working (understandably).

The background to this is that it only started when I made change to the Default Sharing Settings in the SharePoint Admin Centre. The Default had previously been Anyone and I wanted to change that to Direct: Specific People. I am happy for users to still share files with Anyone, I just don't want it to be the Default option. 

Side note: I feel that people are intending to share with a specific colleague but by defaulting to 'Anyone with a link' and then typing in the recipients name my users think they are sharing with just an intended colleague whereas actually they are sending a specific colleague an anonymous link, which is now set to expire after 3 days, where again the default was previously 'never'.

I logged a call with Support and the man who rang basically told me that the system was working correctly, and the 'fix' was to change the Sharing permissions in SharePoint/OneDrive to anything more restrictive than Anyone. But I don't want to restrict my users, just change the default option. 

When I change the Sharing Settings to be more restrictive, Outlook no longer sends the Sender an email saying 'Your recipients couldn't be given access to the file'. But it seems to me that to get rid of this email I am limiting functionality from the sharing options. 

Support sent me this link, but I fail to see how it explains my issue: https://docs.microsoft.com/en-gb/onedrive/manage-sharing?redirectSourcePath=%252farticle%252fee8b91c5-05ec-44c2-9796-78fa27ec8425

Happy to be told I am completely confused and this all makes total sense!

Hope this makes sense, Apologies if this is in the wrong community. It strikes me as an Outlook issue but it could just as easily be a OneDrive issue.