[BUG] Allow MemberCanShare doesn't work when Authentication with Credentials or with Multi-Factor authentication enabled

[ibaettigdev]

Reporting an Issue or Missing Feature

I try to enable sharing for members, but i always get an Access denied error.
My Account is Global Admin and also SiteAdministrator of the SPO Site
Connect-PnPOnline "https://tenantname.sharepoint.com/sites/testsite" -interactive
If i authenticate with an Azure AD App Registration it works
Connect-PnPOnline "https://tenantname.sharepoint.com/sites/testsite" -ClientId $clientid -Thumbprint $thumbprint -Tenant $tenantid

Expected behavior

It should change the SharingSetting to SiteMembers can share files and folders also with interactive login

Actual behavior

Connect-PnPOnline "https://tenantname.sharepoint.com/sites/testsite" -interactive
$web = Get-PnPWeb -Includes MembersCanShare, AssociatedMemberGroup.AllowMembersEditMembership
$web.MembersCanShare = $true
$web.Update()
$web.Context.ExecuteQuery()

MethodInvocationException: 
Line |
   5 |  $web.Context.ExecuteQuery()
     |  ~~~~~~~~~~~~~~~~~~~~~~~~~~~
     | Exception calling "ExecuteQuery" with "0" argument(s): "Access is denied. (Exception from HRESULT: 0x80070005 (E_ACCESSDENIED))"

Steps to reproduce behavior

if you run this code it produces an error:

Connect-PnPOnline "https://tenantname.sharepoint.com/sites/testsite" -interactive
$web = Get-PnPWeb -Includes MembersCanShare, AssociatedMemberGroup.AllowMembersEditMembership
$web.MembersCanShare = $true
$web.Update()
$web.Context.ExecuteQuery()

if you run this code it works:

Connect-PnPOnline "https://tenantname.sharepoint.com/sites/testsite" -ClientId $clientid -Thumbprint $thumbprint -Tenant $tenantid
$web = Get-PnPWeb -Includes MembersCanShare, AssociatedMemberGroup.AllowMembersEditMembership
$web.MembersCanShare = $true
$web.Update()
$web.Context.ExecuteQuery()

What is the version of the Cmdlet module you are running?

PnP.Powershell 2.2.0

Which operating system/environment are you running PnP PowerShell on?

• Windows
• Linux
• MacOS
• Azure Cloud Shell
• Azure Functions
• Other : please specify

[ibaettigdev]

additional information:
Set-PnPTenantSite -Identity "https://tenantname.sharepoint.com/sites/testsite" -DisableSharingForNonOwners:$false
or
Set-PnPSite -DisableSharingForNonOwners:$false
does not work regardless of authentication

[ibaettigdev]

also the same behavior when i use the Parameter "MembersCanShare="true" in the pnp provisioning template
works with app registration -- doesnt work with -interactive authentication
<pnp:WebSettings NoCrawl="false" WelcomePage="SitePages/Home.aspx" CommentsOnSitePagesDisabled="false" QuickLaunchEnabled="false" SearchScope="DefaultScope" SearchBoxInNavBar="Inherit" MembersCanShare="true" />