It would seem that if you add a menu item and set the item to videos>sources>[movie source]>movies that does make it so the main menu item returns two identical submenus. Why it is doing this would be a question probably best answered by @Chillbo. The broken paths shown in your video I wouldn’t want to speculate on as I don’t know how you created those.
A solution that seems to work the way you want it to may be to go to Videos>playlists>new smart playlist and for movies you would set type>movies, name>[your preference], new rule>path - contains - [path to file share], ordered by sort title>OK
Click on the playlist to make sure it is populated correctly. Note that playlists will only display files that are scanned into your library.
Once you have a working playlist you can go back to the home menu configuration and set the item to videos>playlists>[name of the playlist you created]>display and then click on “enabled” and that should give you what your after.