Thanks for the details. Before anything else, did you switch between the standalone OneDrive app and the Microsoft 365 version on your Mac?
The OneDrive folder in CloudStorage is your real sync location, and the Group Containers folder is required by Microsoft’s File Provider framework, which stores app data and often appears as full duplicates even when APFS is reusing storage blocks. Apple’s storage tools show this as separate usage, but the drive is not storing two full copies. Microsoft supports keeping both folders in place. You check real disk usage by opening System Settings, selecting General, then Storage, and reviewing the OneDrive category shown there.