Hi Marc Diaz,
Welcome to the Microsoft Q&A Platform! Thank you for asking your question here.
When you remove the storage account configuration from the ARM template, the Service Fabric system diagnostic logs will still be generated, but they won't be uploaded to the storage account. Instead, they will be stored locally on the cluster nodes, which is what you're seeing on the D drive.
To fully disable these logs and stop them from being stored on the D drive, you need to modify the diagnostics configuration. In your ARM template, locate the diagnosticsStorageAccountConfig section within the Service Fabric cluster resource. Rather than simply removing the storage account reference, you should adjust the diagnostic settings to turn off logging. This usually means setting the relevant flags to false for different log categories.