My issue is that my local files randomly get greyed out. Its not every local file but random ones at random times. The local files that get greyed out though can still be played on my mobile device in both online and offline mode. The only issue is that Spotify will not play automatically; it only plays if I manually select the song.
Turning "Download" on and off on both mobile and desktop does not fix it. Turning off the Local File source or moving the Local Files to a different folder is a temporary fix. This temporary fix works sometimes after multiple tries and often the solution only works for a few days.