Yes, you can use a custom subdomain setup for your G Suite. All you need to do is to setup an MX record
for subdomain.yourdomain.example
and point it to the Google's mail servers. The specific procedures are documented on setting up MX records for G Suite Gmail
Pretty much it should look something like:
Host | Record type | Priority | Value |
---|---|---|---|
subdomain.yourdomain.example | MX | 1 | ASPMX.L.GOOGLE.COM. |
MX records in general are regardless of the domain name zone levelzone level. In your case, the subdomain
zone is the 3rd-level zone -- example
being the root zone. It should work the same either setting up your email addresses as @subdomain.yourdomain.example
or @yourdomain.example
.