Per https://docs.moodle.org/403/en/File_resource_settings#:~:text=Display%20resource%20description,Use%20filters%20on%20file%20content documentation, it says:

Display resource description
If enabled, this setting will display any content from the description box beneath the file (bottom of the page), provided that the Display is set to Embed.

However, it appears it is on a different container. Tested on https://qa.moodledemo.net/

Replication:

Replication:
1. Create a course and turn edit mode to On.
2. "Add and activity or resource", then "File"
Set the following fields:
Name: {whatever name}
Description: {Whatever description. non blank}
Select files: {embeddable file such as an image}
Appearance > Display: {Embed}
Appearance > Display resource description: checked
3. Go to the course contents page and check. Result: The description is not displayed.
4. Click the Actual File resource. Result: There is a description displayed.

Further notes:
If the "Display resource description" is unticked, then there is no description.