You're not alone. The first time I lost access to my locally-stored content when my internet went out, I searched for a solution. There is, one, but it's not obvious--or at least wasn't back when I encountered this problem. I don't know why it would be the default setup, I can't think of a good reason, only nefarious ones. It's one of the reasons I dumped Plex, in spite of having a life-time pass I paid $75 for, I stopped trusting them.