SharePoint folder is in two locations on local machine creating sync conflicts

Hello,

I've got a folder that invertedly (now clue how) ended up in the root folder of the SharePoint on my local Windows.

I have no idea how it ended up here. It’s causing several problems:

1. This folder is mirroring a folder that is already inside the SharePoint Documents library when I have SharePoint opened via browser. (see two screenshots below) 
   How is that possible that a folder is in two locations at the same time?
   
   

   2. This, in turn, is causing sync issues with the Documents folder, as the above folder also exists in the legitimate Documents folder (I guess creating a sync conflict between two locations?)

   

   3. When I try to move the problematic folder, I can't, I get an error, as the folder is in use (I guess by the OneDrive client that makes the sync?)

   

   
   4. This folder on the SharePoint Root, I can't find on SharePoint online. It’s not visible, as I can only access the Document library in SharePoint online (and not the overarching folder?)

How can I untangle this mess and restore the correct hierarchy and sync? What are the best steps to fix?