Box.com - BoxEdit - Conditional Access Azure AD Issue

Question

So we have a tenant that utilizes SSO and has a conditional access policy to not allow connections from outside the USA. Azure AD has integrations with Box.com

A user signs in, loads their box drive and can see their files, open them in the browser etc., and all is good there. There is a button at the top where they can select "Open in Desktop" which opens a window to install "BoxEdit," to allow files to be opened in Office desktop applications. We install it, refresh, but it keeps prompting to install.

After lengthy support sessions with Box, it was determined that when the "Open in Desktop" link is clicked the address should resolve to "http://127.0.0.1:17223/status"

What is happening is it is resolving to "http://127.0.0.1.us3.cas.ms:17223/status?XHR1337MAGICvalueXHR=8ed3335cc2&McasUserAuth=casBFnByb2Q1LW5pcHR1Y2stMjAxODA3MDgF-joZ5IqXQHwJi4xCLQpiUYCKwgykyoPgNcHw1vuE6ndD7N5mk3lYzNlr2JvnGkgdMH5DaIhhUaOzqeHYwWJtesVjoWJsrMziUspSyTnqKwVNNHqE1qs0wAsc-NuyQgC-14PExot6mtqkc808-5PGKAAJdD5XFKEDdEtGe3j0wSq-4mUm-3kSAI76oTYxoxMtppUQFcayURAs0MMRtsSYNHUbsc613gymFcNiEzH4qBzqHduCpV4srwqMfrUjGZp9QMY2n-zI-CtcJfuKDP3icvORx4QWLAs886UmAS2D685TPz6M6kjdDej4R9WGq4o"

and BoxEdit sees an invalid link, and prompts to install the software again. it is adding "us3.cas.ms" which looks like something Microsoft is adding to the address. Does anyone have any ideas as to why this is happening or how to fix it?