Apple TV app media location reverts to default location

In order to use Home Sharing (or other Media Sharing), the Mac Apple TV app doesn’t need to be launched at all at sharing time. So it is perfectly fine to not have this app as startup item. You can access the Mac media library with the app not running. This part is a key difference from using the iTunes application in earlier macOS versions.

If the Apple TV app can't find the Library database [TV Library.tvlibrary] at launch time, then the Apple TV app will create a new Library. This is independent of where the media files are! It is advised to keep the Library database on the boot drive, even when the media files are externally, mounted or not; for this reason.

If the app can find the Library database [TV Library.tvlibrary] at launch time, then it should keep the Media folder location as well. It would only error out (without resetting) when some action tries to access that external drive when not mounted (yet).

Use the in-app Settings to point to a location on the wanted external drive for Media Folder location. Keep the database file(s) where they were originally. To prevent the app from copying media files that are already in the desired directory, uncheck the checkbox for Copy files to Media folder when adding to Library — regardless of where you set the Media Folder to be. This last part is for newly added files only. Previously added files would be unaffected by (changes in) that setting.