iMovie

iMovie will only recognize video clips that are imported into it, or that are revealed when one clicks on the Photos item in the iMovie media sidebar (assuming that you have designated the Photos library as the system photo library in the Photos app general preferences).

-- Rich

Try deleting preferences by opening iMovie while holding down the Option and command keys and selecting to delete preferences in the box that appears. iMovie will open in a new library. Then close iMovie and reopen in your old library to get back to your projects. Now see if your videos get recognized.

— Rich

If the "use as system photo library" is grayed out that means it is already your system photo library. You need do nothing further.

-- Rich