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Hello Jarrett,
The best way is option 1: 1) copy files then install 2.0 – will this then recognize the old 1.7 files without 1.7 ever having been on this PC.
There’s also a batch conversion function so you can convert all the files from 1.7 to 2.1 in one fell swoop if you wish. Otherwise they will be auto-upgraded as you go along and open them (unless you turn that feature off).
Good luck!