I verified that everything works as expected, but I've checked OneDrive regkey entries, group policy, Windows library folder settings, etc. The error in OneDrive --> Settings --> Sync and Backup --> Manage backup still says the Documents folder isn't syncing, when I verified it is.
From: https://learn.microsoft.com/en-us/sharepoint/redirect-known-folders
If folders have been redirected to a network file share:
Use Migration Manager to copy contents in the network file share location to a user's OneDrive, making sure that all contents go into the existing Documents, Pictures, or Desktop folders.
Note
If Migration Manager will create the Documents, Pictures, or Desktop folders, ensure that Preserve file share permissions is not selected when performing the migration.
Disable the Window Folder Redirection Group Policy and make sure to leave the folder and contents on the network file share.
Enable Known Folder Move Group Policy. Known folders move to OneDrive and will merge with the existing Desktop, Documents, and Pictures folders, which contain all the file share content that you moved in the first step.