That's a confusing and annoying UI, to be sure - but for these systems, the email adress is not the identifier. The (email,account issuer) pair is the identifier.

So you can have two accounts, say for (vimslayer@contoso.com, Microsoft Account) and (vimslayer@contoso.com, Contoso AD) - and there is no collision and no possible confusion on the system end. All the confusion is on the human end.

And there is a lot of confusion on the human end :)