Well the issue is not specifically tied to any one of the 3 items: GPO drive restriction policy, OneDrive client and FSLogix. The issue is the intersection of the 3 items.
It would be great if OneDrive was more friendly with RDS, Citrix and other non-persistent environments. I imagine there are others trying to solve the same problem and allow OneDrive functionality while maintaining tight control of the local drives. Maybe most people just surrender the security of the C: drive to allow OneDrive functionality. I am hoping that some really thoughtful and creative individual has found a solution to maintain C: drive access while allowing OneDrive access.