When setting up the VM for Storage Sync, the IP address used for the VM's DNS lookup must be the same IP address as the machine used for Active Directory (the Windows domain controller).  You cannot have separate DNS and Active Directory lookup.

The example below shows how the Storage Sync appliance is configured with incorrect IP address.

The appliance is configured as 172.16.5.82

Active Directory and DNS server on 172.16.10.123

Primary DNS server on 172.16.10.3

You need to change the Storage Sync DNS lookup IP to 172.16.10.123, do NOT use 172.16.10.3