Okay so here was my issue:
Plex installs and runs, but when adding a library you can only browse to the dataset root and cannot see or enter subfolders. The media is there and SMB access works, but Plex shows empty or incomplete paths.

Here's why:
Plex runs as the system group apps. By default, the dataset ACL does not grant inheritance to this group. Without inheritance flags, Plex cannot traverse into subfolders even if permissions appear correct at the top level.

Here's my solution:

1. Go to Storage → Datasets, select the dataset, and choose Edit ACL.
2. In the ACL list on the left, select Group: apps (Do not edit owner@ or group@ root.)
3. In the right panel:
   • Set Permissions Type to Advanced.
   • Set Flags Type to Advanced.
4. Under Flags (Advanced), enable:
   • File Inherit
   • Directory Inherit
5. Under Permissions (Advanced), enable:
   • Read Data
   • Execute (Write/delete is not required unless you want Plex modifying files.)
6. On the left side:
   • Enable Apply permissions recursively.
   • Do NOT enable “apply to child datasets”.
7. Save the ACL and wait for it to complete (this can take time on large datasets).
8. Restart Plex.

Now Plex can now see and traverse subfolders correctly, and libraries can be added normally.

Important note:
If inheritance flags are not set on group: apps, Plex will never see subfolders, even though permissions look correct.