Hi Guys
I have a library file which controls my side_nav_bar for my entire site.
The LBI file is located on the root directory of my website - same place where all my html files are located.
When I make an edit to my library file, it asks me if I wish to update the files that are linked to it.
I say yes, and let it do it's thing, but then I notice that the HTML code has not been updated to the linked html pages.
I have to manually deleted the original library code from the HTML pages, and then drag and drop the library file from my assets folder to force it to link.
Obviously doing this completely defuncts the purpose of having library files.
Have I missed a step ? can someone please assist.

As I understand it, you are moving the lbi files out of their default folder and into the same location as where you store your site. I think that is where you go wrong. By doing so, the lbi files are losing the functions necessay to make them work.

I made an experiment with two html files and a library file. Attached I'm showing the path to the stored files. The path to the lbi file is the important one (not the 'OneDrive' bit, obviously). The html files can be stored wherever you like, here I just accepted the default.