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https://support.steampowered.com/kb_article.php?ref=8379-RYIP-2998&l=english
The main issues with external drives, is the fact that they have the tendency to disconnect and re-connect.
This is a part of their normal operation and seems rather straight-forward.
Steam pings the drives constantly looking for libraries and updates.
If it doesn't see the drive, it assumes it's offline and disconnects the library.
Thus, your games appear as uninstalled.
steam does not recommend it because it has issues - it is because steam does not want to support it it for varios reason. The performance issues onyl exist when ppl just buy random stuff instead of doing it right.
https://steamcommunity.com/groups/Master_Race_Geeks/discussions/0/1735466157768391213/
You can set USB port in power setting and/or devcie manager not to power down. Thatw ay youc an fix potancial disconnect to the drive aswell.
For your current issue:
-is the installation fodler set as steam library?
-is the appmanifest.acf file included?