Azure Local 23H2 Deployment Fails on "OpenSSH"

Question

Hi,

We are trying to deploy Azure Local instance.

After all validations runs Successfully, run the Deployment and it runs Ok until it reach "Install OpenSSH Client" step.
Part of error string contains the following description:

Type 'InstallOpenSSHClient' of Role 'MocArb' raised an exception: Exception occured while installing Windows Capability [OpenSSH.Client0.0.1.0] = Windows Feature On Demand Capability [OpenSSH.Client0.0.1.0] was not installed

We are trying to manually install this Capability (only to know if we are missing some proxy settings) with the following command:

DISM.exe /Online /Add-Capability /CapabilityName:OpenSSH.Client~~~~0.0.1.0
Then it fails with: DISM failed. No operation was performed.

The same command runs OK on a Windows Server 2025 with the same proxy configuration.

Apart from that, on HCI OS, we were able to search for Updates from Sconfig, found one pending install KB5049984, install it, reboot the machine, and we were not able to search Windows Updates again, with the following error:
Values does not fall within the expected range.

Any clue on that?
Thanks