Glad you found your Library! A Photos Library can'd be used from the iCloud drive or any disk that's not directly connected to the computer. So the Photos Library can't be used from network drives or cloud drives like Dropbox or Google. Photos does lots of background stuff directly with the Library, so there has to be a reliable direct connection.
iCloud Photos is not a backup-- it's a syncing service. That means that the things you do to your Photos Library on the Mac are copied on iCloud and transferred to your iPhone and iPad, etc. And vice-versa. So if you erase a picture anywhere, it gets erased everywhere-- not a backup! (Well, it really goes first the the Recently Deleted album and waits for 30 days before it gets really erased. Unless you delete it from there, too!) So if your Mac gets run over by a truck, then the pictures survive on iCloud. But if you permanently delete them from any device, there is no backup! I use a Time Machine drive that I connect to every night, and I make copies of my Libraries to another drive periodically.
To connect your rediscovered Photos Library, go to Photos Settings>General and make this Library your "System Library."

If "Use as System Photo Library" is grayed out, that's because it already is. Also make sure "Copy Items" is checked-- it should be checked by default. There can be only one System Library on a Mac, but there may be other Libraries which are not connected to iCloud.
Then in Photos>Settings>iCloud,
you should check "iCloud Photos." I have Photos on my Mac "Download Originals" so that I can back them up. If storage is a severe problem on you Mac, you can click "Optimize Mac Storage," and when space becomes limited, Photos will only keep smaller images on your hard drive, and it will download full sized images when they are needed for editing or printing. But then backups may only get the smaller images rather than the full originals.