If outlook fails to resolve to Office365 while connecting outlook on local LAN you may have to do the following.
Open up reg edit and browse to: HKEY_LOCAL_USER>SOFTWARE>MICROSOFT>OFFICE>(Version Number)>Outlook > Autodiscover
In this location create New DWORD32 called: ExcludeSCPlookup
Set the value as: 1
Set up a new outlook profile which should now autodiscover as long as the autodsicover.domain record is configured correctly, this can be checked from within the Office365 Admin portal.