Hi Moose,
Base on your question, you can perform an SMTP matching to get it sorted out. After performing it, the account can be managed through on-premise Active Directory instead of Office 365. The Status of the user will be Synced from AD instead of In cloud.
Please click on the link below and follow the steps in there.
http://support.microsoft.com/kb/2641663
Please feel free to let me know if you have any questions base on this thread.
Thanks,
Yang Yu