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Appointments cancelled in dynamics do not show an indication it’s cancelled in Outlook, it’s also not removed from the calendar.

Cancelling a meeting from Dynamics should have the same behavior as when you cancel from Outlook.
Category: Platform
STATUS DETAILS
Completed
Ideas Administrator

There is an orgDbOrgSetting which can be enabled to achieve this result. See the setting named SSSPropagateAppointmentCancellationsToExchange which is in the latest versions starting with 9.1.0.19239:

https://docs.microsoft.com/en-us/power-platform/admin/orgdborgsettings

https://support.microsoft.com/en-us/topic/orgdborgsettings-tool-for-microsoft-dynamics-crm-20a10f46-2a24-a156-7144-365d49b842ba