Problem sharing iCloud Folder - seems related to size of folder contents. "Sorry, your invitation couldn't be sent."

When I try to share a larger-sized folder (contents are about 20GB) of photos of my son with my wife, I get the error "Sorry, your invitation couldn't be sent." It doesn't even get to the point of attempting to send the link or email or iMessage. Other times, it says "Preparing folder" with a spinning wheel, as below:

At the same time as this, I notice a filling dial down by iCloud drive in the greyed-out Finder side-bar. Is it trying to download the whole folder to be able to share it?

All OS are currently updated, and sharing folders works flawlessly with other folders whose contents are smaller. Is this a known error? A bug? Any help out there?