Usually yes for OneDrive and SharePoint, with Work IQ on a full Microsoft 365 Copilot licence, but always test it, because it varies between organisations. Pick a document and ask Copilot whether it can see it and its contents. A network drive is not the same as OneDrive, so test that separately.
More in Microsoft Copilot
Do the Settings in the Copilot Chat menu apply only to that Chat?
No. Settings in the three dots at the top of Copilot Chat open the same global settings as the menu at the bottom of the screen. Any change you make there applies to all your chats. The three dots only show this option on a new, empty chat.
Can I tell Copilot how to name my chats and Pages?
Chats yes, Pages no. Put a naming rule in your custom instructions or save it as a memory, and new chats then follow it in your chat history. Pages are different: Copilot names them in a premade way before it reads your instructions, so rename each page yourself into whatever structure you want.
What is the Library in Copilot?
The Library, in Copilot's left-hand bar, is where Copilot stores what it creates: your Pages, canvases, generated images and other creations. It is storage, not a working feature, and it does not run prompts. Pages are saved there automatically, and a page survives even if you delete the chat it came from.