In order to free up space on my macbook air's internal SSD, I moved my photo library off to an external disk (actually a Transcend JetDrive installed into the SD Card reader port). I have the photo library on the extrnal disk set as the System Photo Library in Photos Preferences, and want to re-enable iCloud Photo Library (which I turned off while I moved the library to its new location). When I try to check the box for iCloud Photo Library, I get the error message "Your full-resolution photos and videos stored in iCloud may not fit on this Mac" and the only options are to cancel or Optimize Storage.
The library shows up as 60.59GB in Finder, and icloud.com says I have 44.99GB of Photos and Videos (which should be the exact same photos, plus or minus a few new iPhone photos taken in the past few days). The external drive is 128GB, and the Photo Library is the only thing on it.
What's going wrong? Why doesn't iCloud realize that it has all this free space to work with? How can I re-enable iCloud Photo Library without deleting photos from my macbook?