Hello David
This is another situation where IOS-XE and IOS-XR behave differently because of the specific roles that they are designed to play.
Specifially, IOS-XR uses intelligent stub vs. transit network detection, while IOS-XE applies prefix suppression more literally.
IOS-XR is able to distinguish between stub networks, that is, segments where NO OSPF neighbors exist, and transit networks, where OSPF adjacencies exist (actual router-to-router links). When you enable prefix suppression on XR, stub networks are still advertised (to maintain reachability to hosts on that LAN) while transit networks are suppressed (because the prefix is only needed for OSPF operations, not as a destination).
This is why your switch-connected interface was advertised initially. XR detected no OSPF neighbors and treated it as a stub network that needs to remain reachable. When you connected a second router and formed an OSPF adjacency, the segment became a transit network, and XR then suppressed the prefix.
IOS-XE on the other hand, takes a more aggressive less intelligent approach. When prefix suppression is enabled, it suppresses ALL non-exempt interface prefixes (except passive interfaces, loopbacks, and secondary addresses). It does NOT automatically distinguish between stub and transit segments. You must explicitly configure passive-interface on stub networks to keep them advertised.
This message indicates the feature is enabled on the interface, but the actual suppression behavior is conditional based on neighbor state. Itās not saying the prefix is absolutely suppressed in all cases.
From a network design perspective, XRās behavior is actually more intelligent. The purpose of prefix suppression in XR is to hide unnecessary transit link prefixes to reduce LSDB/routing table sizes, which is critical for service provider networks. Stub networks with hosts should remain advertised for reachability, and transit networks (router-to-router links) can be safely suppressed.
The prefix suppression feature (RFC 6860) was designed to hide transit-only networks. XR interprets this more literally by actually checking whether a network is transit before suppressing it.
Your lab testing methodology was perfect. Connecting a second router is exactly how you confirm itās working as designed!
I hope this has been helpful!
Laz