ReWrite rule doesn’t work for urls containing underscores

Hope somebody can figure this one out.

I have the following code for a WordPress static export site in my .htaccess file which redirects any request ending in .html to /index.html

e.g.
/subdirectory/pageexists.html
gets redirected to
/subdirectory/pageexists/index.html

THAT works fine.

BUT... if the requested file with the .html includes an underscore I get a "too many redirects" error.

e.g. 
/subdirectory/page_exists.html
tries to connect
/subdirectory/subdirectory/subdirectory/page_exists/index/index/index.html

# Enable Rewrite module
RewriteEngine on
RewriteRule ^ - [E=rewrite:on]

# Check if requested file or directory already exists
RewriteCond %{REQUEST_FILENAME} !-f
RewriteCond %{REQUEST_FILENAME} !-d
RewriteCond %{REQUEST_URI} !index\.html$

# Redirect all .html file requests to equivalent /index.html file request
RewriteRule ^(.*)\.html$ /subdirectory/$1/index.html [R=301,L]

# If the Rewrite module is not active then return a 404 error
RewriteCond %{ENV:rewrite} !on
RewriteRule ^ - [L,R=404]