I have a domain that I own for my group of friends. We have the primary domain (example.com) pointed to our webserver, but we also each have subdomains (billy.example.com, george.example.com, etc) we had setup at google domains and everyone ran a ddns service to keep their subdomains up to date to have them point to their own personal networks.

Now that google domains is dead, I'm looking for an alternative that checks all the boxes, and I thought dynu was going to be it, but I'm having an issue.

I setup my domain (billy.example.com) in dynu.com and installed the dns agent on my pc. The agent updates my domain just fine.
My friend created his own account at dynu.com and entered his subdomain (george.example.com) and installed the agent. It updates his domain just fine also.

However, after pointing the nameservers for example.com to dynu's name servers, these subdomains don't resolve anymore.

Could the issue be that the same domain (example.com) is used for subdomains on different accounts? Is this a valid configuration for your dynu ddns?
I noticed after adding my primary domain (example.com) to dynu dns, some of my friends who hadn't created their accounts yet and added their subdomains couldn't do so until I removed the primary domain from my dynu account. Then it allowed them to add the domains.

Will dynu respond to dns requests for a subdomain (billy.example.com) if the primary domain (example.com) isn't also added to a dynu account?

The answer should be yes as long as example.com list Dynu as name servers. Open a support ticket with your domain and let the staff take a further look.