After a recent Qubes and Fedora update I noticed the “qubes-vm-directory-fedora-36-dvm” appearing in the main Qubes menu with Terminal as the only possible app choice.
I can’t see this template/vm in the Qube Manager and am currently running Fedora 38 for all my qubes.
What is this “directory dvm” and what does it do?
Probably a bug, if you don’t have any fedora-36 template, it shouldn’t be there.
Probably nothing, as you don’t have any fedora-36 template.
You can try by clicking on that terminal shorcut.
You can clean up your menu by deleting all fedora 36 related files in:
/home/user/.local/share/
Clean the files in the three subdirectories.
I’ve deleted the terminal application for Fedora 36 (since I have no such templates) in /home/user/.local/share/ which removed the qubes-vm-directory-fedora-36-dvm from the menu 
I also happened to update dom0 and the templates using the qubes updater and now Qubes wont boot and locks up before LUKS. Probably not related but anyhow… 