My libs and subfolders are on the network. Unfortunately it still searched for and found the original "ACE_PNEU_MENU.DAT" file in the default directory, after I had changed the option you mentioned (not sure why). The .env file has specific commands to change schem and panel icon paths, and these work fine from the new support folder. The other icon menus do not have specific commands though.
I was able to do what I wanted here though. For the information of anyone watching this topic, I talked to my ACAD reseller tech and there is a line in the .env file in the "MISC" section titled WD_SUP_ALT. Here you can specify a support folder to be searched before the default path is searched. My issue went away after doing this.