Hi @Mike S,
Good day, and thank you for taking the time to share the details of your issue, along with the screenshot. It is very helpful in understanding what may be happening.
Based on my research, there is an update currently in progress for PST file support in the New Outlook experience (as shown in the roadmap screenshot), with rollout indicated around July. Although the import option appears in the New Outlook interface, this may indicate that the capability is still evolving and may not yet handle all PST scenarios consistently at this time.
For your reference, you may review the roadmap here:
Microsoft 365 Roadmap | Microsoft 365.

With that in mind, while waiting for this capability to be further rolled out and enhanced in New Outlook, I would like to suggest the following workaround steps, which have helped provide a more stable experience in similar scenarios:
1/ Download Classic Outlook via this link: Install or reinstall classic Outlook on a Windows PC - Microsoft Support
2/ Run the Inbox Repair Tool (SCANPST)
Please follow detail steps at Repair Outlook Data Files (.pst and .ost).
3/ Use Classic Outlook to perform the import
- Open Classic Outlook and sign in with your account
- Go to File > Open & Export > Import/Export.

- Select Import from another program or file, and then select Next.

- Select Outlook Data File (.pst) and select Next.
- Then select the .pst file you want to import. Under Options, choose how you want to deal with emails and contacts, then choose Next.

I hope this information is useful. Thank you for taking the time to raise this question. If you need any further clarification or assistance, please feel free to leave a comment under this post.
Thank you for your understanding and contributions to the forum.
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