1. Don't quite understand the question, but you want both of those options checked. They refer to data sync and you can only sync data through Zotero (the full text option isn't required but will make sure full text search works on all your Zotero instances).
2. Zotero doesn't, but the Zotmoov plugin described in the linked post does this for you.

@adamsmith - Thank you! Your clarification helped clarify part of my question.

@tim820 - Thank you! Your explanation provides better context compared to the manual page.

Guess key question is: I want the files to be on onedrive folder and not on zotero storage. Are the settings correct to make sure we are using onedrive for files and not zotero cloud storage?

Thanks!

@adamsmith - Thank you! Please find the images enclosed
https://s3.amazonaws.com/zotero.org/images/forums/u17217897/jq87o9o2s8s5jgom5tgg.png
https://s3.amazonaws.com/zotero.org/images/forums/u17217897/xnqj4hgaijrp1nlyhs36.png
https://s3.amazonaws.com/zotero.org/images/forums/u17217897/707ubmxn0gw1by8o73ev.png

Indeed, the blog post doesn't clearly show that you need to turn OFF Zotero *file* syncing (there are only isolated cases where you might have a mixture of "stored" files - that would use Zotero syncing - and also linked files that you sync yourself via Onedrive).

And you only want the second box under File Syncing checked if you have a Group Library. Linked files don't work with Group libraries, so Group PDF files have to be "stored" files (which count only against the group owner's online file storage quota).

In Zotmoov settings, I would also uncheck Automatically Move/Copy Files to Subdirectory unless you *really* want that. Linked files are much easier to manage/locate if in a single folder (the 'Move To' folder). The Zotmoov documentation tends to make people think they should use that function, to put PDFs in subdirectories in their OS that match their Zotero collection names. But it was just a rarely-used feature in Zotfile that Zotmoov also implemented.

The Automatically Delete External Linked files setting is there because Zotero does not delete linked files when you delete their parent item. So you can be left with "orphan" files in your linked files folder. Zotmoov can do that deletion for you. So you should turn that setting ON. People have also used the delitemwithatt plugin for that (you can have both).

BTW "sync full-text content" confuses many people. They assume it means syncing of PDF files via Zotero file storage. It doesn't. It's the text indexing data *from* the files, that Zotero uses for searches. So it's "data" (like item metadata), not files. Data syncing is free and unlimited. That's why it's set to ON.

As noted, you don't need a Linked Attachment Base Directory setting unless you have two or more computers and the (parent) path to your Onedrive linked files folder is different on at least two computers. If that becomes the case later, it's easy to set a LABD then.

@adamsmith - Thank you! I have updated the setting per suggestion

@tim820 - Thank you! The reason for move/copy setting is to migrate the current files stored to the new onedrive location. If this setting is not required, I can definitely uncheck it.
LABD - need to make sure my lab system in secure location and my note computer is in sync. This is done through onedrive. In the past, I only had the note computer with research dating back to 1987.

I agree on the sync full-text context comment. It can confuse. Thank you for the initiative to address this issue.

Once again, thank you very much. This conversation is much appreciated.