How to simulate external azure active directory / create testing environment?

We regularly face the situation where access to internal applications (e.g. PowerBI) by external users (guest users in our AAD) need to be troubleshooted (errors in application specific configs). Currently we can only reproduce these issues by having the external users themselves present and repeating what they did.

What would be the best way to create a test environment to simulate users which are not in our AAD or tenant?

What would be the best way to create a test environment to simulate users which are not in our AAD or tenant?

Pretty much the only way is to set up a new Azure AD. That's also fairly quick, cheap (free if you don't require any licenses), and there's no maintenance involved.