Is it possible to "Hide" a inactive item in Adagio Inventory? Please advise

Yes, You can hide it from the Grid and from the finders by double clicking in the grid column row.
There is a box to include Active records only. If you are using SYS, you need to disable the option to Set the view for all users to set the filter and then, edit the grid columns to enable the box to set to all the users.

Needs to be done both on the grid and the finder.

Thank you