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I'm converting a shed that is ~125ft from our main house into an office. *We will be digging a path and running power underneath anyway, so running cable isn't an extra cost for us here. Few Qs: 1. Is PtP, underground Ethernet, or underground Fiber best in this scenario? 2. It sounds like I'll need to get the starlink Ethernet adapter to use for the underground cable, is that correct? 3. Does it need to be a separate router in the shed, or just an AP plugged into the ethernet adapter? Any tips from someone who has done something similar would be very appreciated!

Have you physically cut the cable and rejoined it? If so that's the most likely cause of your problems. You can go from the original Ethernet adapter into a switch then use a longer Cat5 cable (or fibre) to make the connection back to the house.