My guess is that the firmware/device does not support SHA-2, which Office365 requires.
But as you are using a relay I can't speak with certainty.
I know to use SMTP.office365.com on port 587 with STARTTLS, there are hardly any Xerox devices that can scan with a firmware released pre 2017.
The latest version available for the WC3335 is newer than that and is located here so I would go ahead and install that first off, then start troubleshooting if still needed from there.