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+To fix the issue, we need to modify the `formatPath()` function in `WelcomeRecentFiles.tsx` to apply max-length truncation even when the path has two or fewer segments. Here's the exact code fix:
+
+```typescript
+function formatPath(path: string, maxLength: number = 60): string {
+  const normalized = path.replace(/\\/g, '/'); // Normalize slashes
+  if (normalized.length <= maxLength) {
+    return normalized;
+  }
+
+  const parts = normalized.split('/');
+  if (parts.length <= 2) {
+    // Apply max-length truncation
+    if (normalized.length > maxLength) {
+      const excess = normalized.length - maxLength;
+      const middleIndex = Math.floor(normalized.length / 2);
+      const left = normalized.substring(0, middleIndex - excess / 2);
+      const right = normalized.substring(middleIndex + excess / 2);
+      return `${left}...${right}`;
+    }
+    return normalized;
+  }
+
+  // Existing logic for paths with more than two segments
+  // ...
+}
+```
+
+In this code, we added a check to see if the normalized path is longer than the `maxLength` when there are two or fewer segments. If it is, we apply a middle truncation by removing characters from the middle of the string and replacing them with an ellipsis. This ensures that the displayed path respects the `maxLength` constraint in all branches.
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