Email Address Filters and System Address Filters are all configured as per the following documentations mentioned below.
Despite the fact that the steps have been followed, the exclusion listed domains still break through the email readers and generated cases based on inbound actions created.
The cause of this issue is that the default checkbox on the System Address Filter has not been enabled, and that causes the filters to be not applied on the email account by default.
Enabling the default checkbox can resolve the issue.
There is also another workaround if you don't want to enable the default checkbox by default for all of your email accounts, which is to manually go to the email readers and then select the System Address Filters reference variable and then select the System Address Filter from there. This step also resolves the issue, but only works for that specific email account.
The knowledge about the default checkbox is also mentioned in the article attached in the description.