Problem pointing domain to subdirectory in .htaccess

I created a project based on laravel api and nuxt (pre-rendered), where the backend (api), inside root is served via api.domain.com (subdomain) and nuxt front-end, inside a separate folder root/client/dist, is served via domain.com (primary domain). I created the following .htaccess file at the root:

<IfModule mod_rewrite.c>
    <IfModule mod_negotiation.c>
        Options -MultiViews -Indexes
    </IfModule>

    RewriteEngine On

    # Handle Authorization Header
    RewriteCond %{HTTP:Authorization} .
    RewriteRule .* - [E=HTTP_AUTHORIZATION:%{HTTP:Authorization}]

    RewriteCond %{HTTP_HOST} ^(www.)?domain.com$
    RewriteCond %{REQUEST_URI} !^/client/dist/

    # Redirect Trailing Slashes If Not A Folder...
    RewriteCond %{REQUEST_FILENAME} !-f
    RewriteCond %{REQUEST_FILENAME} !-d
    RewriteRule ^(.*)$ /client/dist/$1

    # Handle Front Controller...
    RewriteCond %{HTTP_HOST} ^(www.)?domain.com$
    RewriteRule ^(/)?$ client/dist/index.html [L]

    //FOR API REQUESTS (LARAVEL)
    RewriteCond %{HTTP:Host} ^(?:api\.domain\.com)?$
    RewriteCond %{REQUEST_URI} !^/public/
    RewriteRule ^(.*) public/$1 [NC,L,NS]

</IfModule>

The urls domain.com and api.domain.com work fine. However, when I access domain.com/products, it redirects to domain.com/client/dist/products/, resulting in 404 Not Found error. However, when I access the same url from homepage, it renders correctly without any redirection.

Is there any way I can solve this? I tested it with nginx sites-enabled and it works fine.