ARK is installed on H:.

Steam is staging downloads on H: (the same drive as the game).

Mods are still appearing on G: in steamapps\downloads\346110.

You have already cleared caches, checked permissions, libraries, etc. — none of those helped.

You have already deleted the G: downloads folder — it came back.

This is not caused by staging path, permissions, caches, or libraries.

What this actually tells us

The problem is Steam itself is repeatedly creating the downloads folder on G:, even though everything is installed and staged on H:.

This is not a user configuration problem — it is almost certainly a Steam client bug specific to ARK Workshop downloads.

There is no “normal” fix at the user level that will stop it from creating this folder.

Conclusion

All my previous advice about caches, permissions, staging, deleting folders, libraries, etc., was wrong and irrelevant given your setup.

The real issue is Steam mismanaging ARK Workshop downloads, leaving a duplicate folder on a different drive.

There is no standard configuration fix that will stop it — only workarounds or Valve needing to fix the bug.