Appreciate the response!
So yeah, Matrix rooms versions (https://spec.matrix.org/v1.7/rooms/) effectively just add or fix certain features and are used as a way to upgrade things without necessarily breaking existing setups. Room version 1 isn't necessarily bad, but some alternative implementations (e.g Conduit https://gitlab.com/famedly/conduit/-/issues/288 & https://gitlab.com/famedly/conduit/-/issues/152) have issues with interoperating with rooms v5 or lower. Their take is seemingly just waiting out rooms eventually migrating upwards.
Upgrading a room, as far as I know, can be done via:
It would create a new room, invite users to the new room, with the first message being a link to the old room to "preserve" history. It's not necessarily destructive but I could absolutely see it being considered interruptive.
That all said, Conduit doesn't proclaim itself as release ready yet or anything, so please don't take this as me saying y'all have a problematic room - if anything, it's me opting to run Conduit that's the issue! So please don't hesitate to tell me "nope" if it's too much of a chore. Love the project either way!
Edit: Added second link