I can only talk about the cloud version, I don't have OnPrem exposure.
When you make a deployment, it's mandatory to have a downtime. Microsoft must copy all binaries to all AOS Servers, restart, sync database, etc.
Microsoft this year, implemented a new procedure in deployments that decreased downtime by 50% ( my experience ). In a D365 with +25 AOS Servers , you can upgrade in less than 1h of downtime.
Some business processes are supported in offline mode ( POS, some WMS Operations, etc), you can continue operating even if there is a downtime of D365. You must check if this is applicable to your business.
When there is an D365 outage ( I have already been there ), you need to contact Microsoft to assist you. When there is an Azure Data Center outage, Microsoft promotes an automatic D365 azure migration to another data center, you can have some data loss on this procedure ( not sure exactly, but I think is 15 minutes of data.
