After KB5020435 is applied to the AVD session hosts, and after updating the remote client's Remote Desktop app version beyond 1.2.3213, clients are unable to connect to the session hosts. After authentication, they receive the following error message: An authentication error has occurred. A specified logon session does not exist. It may have already been terminated. Error code: 0x0, extended error code: 0x0, Activity ID: 5278116b-4dd6-4e08-a3b8-5f1bce1c0000. If we uninstall that hotfix from the AVD session hosts or use an older version of the Remote Desktop client for Windows, this error does not occur.
Our AVD session hosts are running Windows 10 21H2.
End users are running a mix of operating systems and clients. The problem occurs with the Windows client (versions noted above), and with the web client, but does not occur on the Store App client or on macOS clients.
After a lot of troubleshooting, we found that removing the enablerdsaadauth:i:1 setting from the RDP settings of the host pool, users are able to connect again. This parameter was set to enable a more seamless Azure Active Directory authentication experience, but we did not realize this was a preview feature. We have a ticket open with Microsoft support and we are awaiting further information on how we can reenable this functionality.