David Estes wrote:
In my Photos app I have selected the preference to "Download Originals to this Mac." Shouldn't that be the same as storing copies outside the Photos app folder?? Doesn't seem to work.
"Download Originals to this Mac." is telling iCloud Photos to download all originals from iCloud to your Mac and not to use the "optimize Storage" option. The downloaded originals are stored inside your Photos Library and not in a folder outside the library. All originals will be mirrored on your Mac and you will have a complete photos library and can work with your photos, even without an internet connection. And Time Machine can make backups of your photos. It is the way I like to use iCloud Photos, just for syncing my devices, not for saving storage.
Photos has an option to store the photos outside the library and referencing them in the original location, but then you cannot use iCloud Photos. This is controlled by "Photos > Settings > General > Importing: Copy items to the Library". It is a left-over from iPhoto and Aperture, when we could import photos without copying them into the library and reference them in the original location. If Photos would not support this we would not have been able to migrate iPhoto and Aperture Libraries to Photos. But I cannot recommend to use Photos this way. There are no tools to relocate the referenced files to a different external drive when we need to replace the drive because it is failing, or when we need to restore referenced files from a backup. After migrating a referenced library to Photos we should instantly consolidate it and turn it into a managed library. It will be much easier to maintain, particularly, if we want to be able to sync the Photos Library with iCloud Photos between our devices.