W10 Feature Upgrades offered to users regardless of WU Settings?

pdlt3 I recommend that you reach out to support so we can dive into specifically what's happening, since there are mixed signals.

If you are using Windows Update for Business and Feature Update deferrals, or you are using Feature update profiles in Intune, then feature updates would not show up as optional.  Approved updates are treated as required.   In addition, the max deferral for feature updates would be 1 year, so devices managed this way should not be on anything older than 21H1.

Support can help dive into your settings in your admin tool, the settings on the device, and can figure out what changes are needed to get the desired behavior.

Another option, is to follow the recommended settings in this 

 Manage Windows updates in the cloud - Learn | Microsoft Docs

HTH,

-David