Xbox Series S Capture&Share Not recognizing external drives

Yes the USB drive is brand new and works on the computer. Tried all prior fixes listed above and nothing. Files work on the drive. Trying to capture gameplay on Xbox series x. Won’t recognize as an option to change the location of capture and share to the jump drive.

Sadly I don't think there is anything you can do if the Xbox app doesn't recognize these captures.

The external captures allows you to store them and share them online anywhere, but it doesn't seem possible to share over Xbox Live.

Nope. For two reasons. The Series S won't recognize the games from an external drive and you need a license to play the games. Since they were purchased on disc, the disc has the license and would need to be in the disc drive to verify you own the game.
Since the Series S doesn't have a disc drive, the games have to be purchased digitally.

There is only a finite space on the console internal drive to store captures.

To my understanding, if you make a lot of game clips and screenshots that space is quickly used up and any subsequent captures will overwrite the oldest file on the drive if its full. This space is a reserved area in the system area and not the entire drive space.

If you upload your captures to the Xbox Network and/or OneDrive you can safely delete the captures on the internal drive using Manage captures on xbox console.

The alternative is to connect a external drive, formatted to NTFS, and change your capture location to the external drive. Be aware that this option doesn't allow sharing on the Xbox Network.

This article explains the difference between using a regular external hard drive versus the custom external storage for the Series S/X- https://news.xbox.com/en-us/2020/09...xbox-series-s-custom-storage-solution-primer/

An external hard drive used on the One will work for the Series S/X, but won't have the exact same performance as the one created for the Series S/X.