The way to set this up is the following:
Look up the category ID of the specific folder of the DAM.
You can find this by navigating to the folder and retrieving the ID (the bit behind the '=' icon) from the category.
Navigate to the specific product in the admin and click on the 'Templates'-tab.
Fill in the ID under 'Media gallery categories'. When using multiple categories, you can fill in multiple IDs separated with a ';'.
When is this useful?
It can be useful to make a certain folder available for a template. For example, during campaigns, it could be useful to just make a certain range of assets available to be selected in, for example, a social post template.