Import iTunes media backup to new Mac

I sold my old iMac 4 years ago. 300 MB lossless ripped CD's etc., so I made a backup of the complete iTunes folder, incl. a "iTunes Library.itl" file.

Now, in 2023, i bought a new MBAir, and wanted to access the music from the external HDD. my internal HDD is too small for the complete library, so I would like to keep the music on the external drive.

Launching the Music app w/option key, I select the itl-file on the external HDD, but ""iTunes Library.itl" does not appear to be a valid library. Please choose a different library"... so...

Do I need to import the individual music files to a fresh library? If so, do I loose metadata/cover art etc.?

Can I concert the itl-file to something useful when I only have access to the current (Ventura) Mac?

Cheers from Denmark/ K