When sending an email via Microsoft Graph, the sender's display name (myself) appears as "B?undchen" instead of "Bündchen." This name is not passed to Graph in any way.
Analyzing the message, I found the following:
From: Max B?ndchen <(ommited)@hotmail.com>
Interestingly, if I add an accented character to the body of the email, the display name appears correctly. In this case, the correct encoding is included in the message:
From: =?iso-8859-1?Q?Max_Bündchen?= <(ommited)@hotmail.com>
I've already tried sending the POST as UTF-8 and ISO-8859-1, but the result is the same. I even tried changing my name in the account profile, but that didn't work either.
I had the same issue when sending a HTML email, and after reading your post I resolved it by inserting ​ (U+200B ZERO WIDTH SPACE) somewhere in the email body.
For the curious there is a list of invisible characters https://invisible-characters.com/