This is happening on my child's account on Switch. The auth through https://aka.ms/remoteconnect with his credentials is successful, but the Switch then displays the error message. It worked yesterday, and no changes were made to the account, but today it's not working.
This is a child account that I've setup in my family settings. I'm fairly certain that I did not create the account from the Switch, but instead through the Xbox website.
Unsure if related, but it's another data point. Yesterday my son was able to connect to his friend's world with no problem. Today his friend signed into his xbox live account for the first time on the switch and hosted the same world. Now my son can't connect to the world. The connection gives a timeout error after several minutes. However, my daughter is able to connect to that world from her iPad while signed into Xbox Live.