.NET Core executables fail if .NET Core is not installed in default location

Steps to reproduce

Download .NET Core CLI to $env:USERPROFILE/.dotnet/x64 and install a global tool

$env:PATH="$env:USERPROFILE/.dotnet/x64;$env:PATH"
dotnet-install.ps1 -Version 2.1.300-preview3-008646 -InstallDir $env:USERPROFILE/.dotnet/x64
dotnet-install.ps1 -Runtime aspnetcore -Version 2.1.0-preview2-final -InstallDir $env:USERPROFILE/.dotnet/x64
dotnet tool install -g dotnet-serve
dotnet-serve

Expected behavior

The generated shim dotnet-serve.exe should find and use the dotnet on PATH to launch the global tool.

Actual behavior

If no .NET Core is installed in C:\Program Files\dotnet

PS > dotnet-serve
A fatal error occurred, the required library hostfxr.dll could not be found.
If this is a self-contained application, that library should exist in [C:\Users\namc\.dotnet\tools\.store\dotnet-serve\0.3.0\dotnet-serve\0.3.0\tools\netcoreapp2.1\any\].
If this is a framework-dependent application, install the runtime in the default location [C:\Program Files\dotnet] or use the DOTNET_ROOT environment variable to specify the runtime location.

If .NET Core is installed in C:\Program Files\dotnet, but doesn’t have the right shared framework version

PS> $env:COREHOST_TRACE=1
PS> dotnet-serve
Tracing enabled
--- Invoked apphost [version: 2.1.0-rc1-26419-02, commit hash: 515f580aa000600da03e81537396d2253b16fa12] main = {
C:\Users\namc\.dotnet\tools\dotnet-serve.exe
}
The managed DLL bound to this executable is: '.store\dotnet-serve\0.3.0\dotnet-serve\0.3.0\tools\netcoreapp2.1\any\dotnet-serve.dll'
Using default installation location [C:\Program Files\dotnet] as runtime location.
Reading fx resolver directory=[C:\Program Files\dotnet\host\fxr]
Considering fxr version=[2.0.5]...
Considering fxr version=[2.0.6]...
Considering fxr version=[2.0.7]...
Detected latest fxr version=[C:\Program Files\dotnet\host\fxr\2.0.7]...
Resolved fxr [C:\Program Files\dotnet\host\fxr\2.0.7\hostfxr.dll]...
Loaded library from C:\Program Files\dotnet\host\fxr\2.0.7\hostfxr.dll
Probed for and did not resolve library symbol ????????????
The required library C:\Program Files\dotnet\host\fxr\2.0.7\hostfxr.dll does not support relative app dll paths.

Environment data

dotnet --info output:

.NET Core SDK (reflecting any global.json):
 Version:   2.1.300-preview3-008646
 Commit:    8e01912b36

Runtime Environment:
 OS Name:     Windows
 OS Version:  10.0.16299
 OS Platform: Windows
 RID:         win10-x64
 Base Path:   C:\Users\namc\.dotnet\x64\sdk\2.1.300-preview3-008646\

Host (useful for support):
  Version: 2.1.0-rc1-26419-02
  Commit:  515f580aa0

.NET Core SDKs installed:
  2.1.4 [C:\Users\namc\.dotnet\x64\sdk]
  2.1.100 [C:\Program Files\dotnet\sdk]
  2.1.105 [C:\Users\namc\.dotnet\x64\sdk]
  2.1.300-preview2-008530 [C:\Users\namc\.dotnet\x64\sdk]
  2.1.300-preview3-008646 [C:\Users\namc\.dotnet\x64\sdk]

.NET Core runtimes installed:
  Microsoft.AspNetCore.All 2.1.0-preview2-30478 [C:\Users\namc\.dotnet\x64\shared\Microsoft.AspNetCore.All]
  Microsoft.AspNetCore.All 2.1.0-preview2-final [C:\Users\namc\.dotnet\x64\shared\Microsoft.AspNetCore.All]
  Microsoft.AspNetCore.All 2.1.0-rc1-30613 [C:\Users\namc\.dotnet\x64\shared\Microsoft.AspNetCore.All]
  Microsoft.AspNetCore.App 2.1.0-preview2-final [C:\Users\namc\.dotnet\x64\shared\Microsoft.AspNetCore.App]
  Microsoft.AspNetCore.App 2.1.0-rc1-30613 [C:\Users\namc\.dotnet\x64\shared\Microsoft.AspNetCore.App]
  Microsoft.NETCore.App 1.1.5 [C:\Users\namc\.dotnet\x64\shared\Microsoft.NETCore.App]
  Microsoft.NETCore.App 2.0.7 [C:\Users\namc\.dotnet\x64\shared\Microsoft.NETCore.App]
  Microsoft.NETCore.App 2.0.7 [C:\Program Files\dotnet\shared\Microsoft.NETCore.App]
  Microsoft.NETCore.App 2.1.0-preview2-26406-04 [C:\Users\namc\.dotnet\x64\shared\Microsoft.NETCore.App]
  Microsoft.NETCore.App 2.1.0-rc1-26419-02 [C:\Users\namc\.dotnet\x64\shared\Microsoft.NETCore.App]

To install additional .NET Core runtimes or SDKs:
  https://aka.ms/dotnet-download

[livarcocc]

This is by design and the decision we made on the host taking many different things in consideration. I believe the dotnet install message will guide you to setting DOTNET_ROOT if your dotnet is not installed in the default location.

[tmds]

Independent of implementation, a user expects this to work:

$ dotnet tool install -g dotnet-serve
$ dotnet-serve