But how is the "system designated one" actually designated.
If buying a new iMac and logging in with the same Apple ID gets me the Photos library, and in Preferences I select "download orginals to this Mac" being the NEW MAC, then I'm golden right?? Logout of apple ID on the old iMac and format/recycle. Is my new iMac NOT the designated one at that point? If I option/Photos and select as system library, that's the "designation" correct?
Also, I've always been meaning to figure out how I'm ever going to get the wife to not have all the photos in the same library (over 150K!!) Please elaborate on "drag my archive libraries".
If you only have one library, it will be the System Library. When you set up the new computer and sign into iCloud it should transfer the iCloud library to the new computer. If you don't have space equal to the size of the library you have to use Optimize Mac Storage, then only placeholders are downloaded and you can access the full size from iCloud at anytime (You have an internet Connection)
[EDIT: It can take some time to sync large libraries] Don't rush to logout of iCloud on the old one, until you have validated the new one is fully there.
If you have multiple libraries, what I mean by drag, is go to finder and the photos folder, then copy a non system library to the iCloud Drive in a backup or OtherPhotos folder, then you in a sense, have a back up of that library. I don't use large drives, so my Mac mini only has a 128Gb drive, it have all my other libraries in the folder in iCloud. I have them in other back up locations as well, I tend to over back up.
I've found that I don't need or want more than a few thousand photos in any library. Others, like your wife, and mine, have a very different attitude about this.
I share new photos with friends and family within the first week of taking them. I reminisce over photos for about a year and occasionally look for something to PROVE something to someone. After a year, I keep my photos that lasted a year, in an alternate library. Christmas, vacations etc.
I take a great deal of photos, I save half of them. I realized one day, just like music, it doesn't make sense to collect them if I don't use them. I used to have 48 days of continual listening in my music library. Now I stream everything! Unless I know I'll be away from internet, then I download a playlist or two.