After switching path in TS3L501E, the ethernet switch that gets connected wont pass traffic until manually disconnecting the port and reconnecting.

Carlos,

Do you believe that the TS3L501E device is preventing communication to pass through the switch?  These switches are passive FET switches that can be ideally modeled as 0 ohm wires.  The best way to trouble shoot this is to remove the TS3L501E device and short the signal path and see if you are still seeing the same issue.

When the path of the TS3L501E changes, the new connection to the Ethernet switch sometimes puts the Switch  in a state where it wont pass any data.

What is the voltage on the SEL pin and PD pin during this error state?  What is the impedance on the I/O path during this error stat

The failures rates is about 1 in 10 SEL toggles.

I agree this is a high failure rate

If the path is not changed after power up, the two Ethernet switches operate normally.

When you say two Ethernet switches do you mean that you are using 2x TS3L501E devices?  Would you be able to draw a diagram? 

Could some on-going data transfer at the moment of the path change be affecting the Switch that gets connected?

The TS3L501E will connect the A port to the B or C port depending on the voltage on the SEL pin.  Changing the voltage on the SEL pin will determine if B or C port connects to A port

Is there minimum disconnect period, or PD mode period, recommended before connecting  the server to a different switch?

I wouldn't know the servers requirements of when it can or can't be connected to a device. As far as the TS3L501E device is concerned as long as it has a valid Vcc voltage level for several micro second the device will be fully functional and able to toggle the signal paths without issue.

Thank you,

Adam