First I need to understand the difference between iTunes Library and iTunes Media and think carefully how to rephrase my question(s), as there are other things that need to be resolved.
Sorry, I should have provided a bit more detail on what I was referring to. Think of "iTunes Media" as the books in a library and the "iTunes Library" as the Dewey Decimal system cards to find those books. Okay, I'm carbon-dating myself with that analogy. 😉
Going back to iTunes, the iTunes Library is a data file that keeps track of the contents of your iTunes Media. This includes the list of all the music and video tracks you have in the library, as well as any playlists and smart playlists you have created. By default, this file is located at ~/Music/iTunes/iTunes Library (where ~ represents your home folder).
The iTunes Media is a folder that contains the actual music and video files that iTunes refers to. It's important to know that the contents of the media folder don't necessarily match the contents of the library itself. There can be files in the media folder that aren't in the library, and you can also add files to the library which aren't in the media folder. By default, the media folder is located at ~/Music/iTunes/iTunes Music.
iTunes can work with multiple Library and Media folders ... and this is where proper backup strategy is important. For example, if you hold down the Option key before starting iTunes, you will be given the opportunity to select which iTunes Library that you want iTunes to open with.
Hopefully this helps you ... and happy Winter solstice and Lunar eclipse to you as well!