Using the New Outlook for Mac features in business environments
First, I'd like to set expectations that I'm a fellow community member and not a Microsoft representative. I simply wanted to join the discussion, share what I know, and hopefully provide information that may be helpful. The issue you're experiencing does not appear to be specific to your Mac. Rather, it seems to be a known issue that has been widely reported by multiple users.
I recommend reviewing the following thread, which describes the same behavior and has already received significant attention from other affected users (received 100+ "I have the same question"): Outlook Mac showing tons of abnormal editor underlines when drafting emails - Microsoft Q&A
In that discussion, one of the users shared an update stating that the issue was occurring across all emails in Outlook for Mac, including new messages, replies, and forwards. The affected systems were running the latest version at the time, 16.111.1, and the problem started immediately after updating to that release.
The user also mentioned that they had reported the issue through Contact Support, and Microsoft Support subsequently confirmed that it was a bug requiring a product fix, rather than an issue that could be resolved through local troubleshooting or configuration changes.
So for now, the only workarounds I'm aware of are using Classic Outlook, switching to Outlook on the web, or disabling the Microsoft Editor feature.
Other than that, it looks like we're waiting for a future Outlook update to address the issue.
If my response helped inform you about this known issue and its current limitations, please consider clicking "Yes" button below. Doing so may help other users experiencing the same issue quickly recognize it as a known problem and save them from spending unnecessary time troubleshooting their Macs or Outlook settings.
Thank you for your time and support.