Disaster: Dropbox removing external disk support for Mac users :(

EDIT: My procedure below worked for me because I had unwittingly upgraded to "Dropbox for macOS on File Provider" several months ago – before Dropbox finally stopped prompting certain Dropbox users to upgrade. The advice below is a way to "downgrade" and allow storage on an external drive.

I found the way to downgrade from "Dropbox for macOS on File Provider" at https://help.dropbox.com/installs/dropbox-for-macos-support. I logged out and back into Dropbox on my MacBook Pro (500 GB boot drive) running macOS Monterey. I was able to opt out of "Dropbox for macOS on File Provider" and select an external SSD drive as my Dropbox location. My Dropbox files synced up selectively, exactly as I had previously configured.

Here is an excerpt from the above page:

If you’ve updated to Dropbox for macOS on File Provider but want to change the location of your Dropbox folder back to your external drive, you can do so by following the instructions below.

To log out of your account:

1. Click the Dropbox icon in the menu bar.
2. Click your profile picture or initials.
3. Click Preferences.
4. Click Account.
5. Click Sign out.

You’ll then be prompted to re-enter your account information.

To log back in to your account:

1. Click Sign in with Dropbox.
2. Select how you want to store your files (local or online-only).
3. Click Next.
4. Click Advanced settings when you see “You're almost finished.” 
5. Under Dropbox location, select a folder location.
   • You can choose to store the Dropbox folder on your external drive from this screen.
6. Click Done. 

Note: Changing the location of your Dropbox folder may cause issues opening online-only files in third-party applications. These files may need to be re-linked.