Hi ,
I was aslo facing the same issue. Researched a bit and came across below doc : https://techcommunity.microsoft.com/t5/apps-on-azure-blog/public-preview-creating-web-app-with-a-unique-default-hostname/ba-p/4156353
So, to avoid DNS dangling a new feature is launched in azure which created hostname like mentioned in the question and it doesn't get registered to DNS. You need to create new Web App with highlit flag off
After this , it will work.