Groove does not display any Album or Artist Art

This is precisely the behavior I discovered. 

When a music file is located in the "Music" directory parallel to downloads/documents/pictures etc. The embedded Art will display. As soon as you play from -any- other directory the album art comes up blank. The only solution is to have it 1.) In a microsoft OneDrive folder or 2.) In the music directory exclusively.

This is a major design failure in my opinion.

I switched my default player back to WMP as it displays the embedded art no matter where the file is located.

Here's an odd behavior I just figured out about Groove after spending some time tinkering with tags...

It only show me album art if the mp3 files are located in the My Music folder (or a subfolder therein). It doesn't even matter if the file has embedded album art - it will evidently look it up when it adds it to its library. But I can take a mp3 file that works and shows album art when located in My Music, but when I copy it to another folder (like my Desktop) and play it from there, no more art.

So if you've made sure you're tags are correct for artist, album and title, make sure the file is located under My Music and not in your Downloads or somewhere else if you want Groove cover art to show up. Or use another music player that behaves more sanely and will just show you the embedded cover art.

I just tried the new version. It said it was a "major upgrade" and was rebuilding my database.

Short version: It didn't work. The results are as before.

Long Version:

MP3/M4A = No artwork (mostly), other tags seem to be read correctly.

iTunes had populated the folders with folder.jpg so, on the off chance that Groove was "confused" by having BOTH folder.jpg AND embedded art, I removed all folder.jpg. Same result as before.

FLAC = Some artwork. Still has problems with artist and genre tags.

What's most disappointing about this is that Microsoft aren't engaging with users about this. They don't even acknowledge the existence of the issue. What I would like from Microsoft is a statement that they know about it and that they're working on it. Then we wouldn't waste our time tearing our collective hair out trying to find workarounds ourselves.

I see that the Groove team has now released the UWP version of Groove to Windows Insiders running the technical previews of the next version of Windows.

That version of Groove finally does seem to be picking up Album covers from the metadata of FLAC format files, which previous versions never managed to do. However, although it manages to also pick up the Album Artist metadata, it still can't manage to pick up the Track Artist metadata, but displays "Unknown Artist" everywhere.

I think everyone may want to stop messing around with ID3 tags.  

Er, until Groove can guarantee 100% correct metadata via its online service, then, no, I won't stop "messing around" with ID3 tags. Many of us carefully curate our music collections, and don't appreciate it when Groove or other music player applications insist on overwriting our metadata with wrong information, as is all too often the case.

And of course, Microsoft will never to able to guarantee 100% correct metadata, so those of us who care about our metadata will always want the option of being able to manage it ourselves.