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If Unreal Engine wanted to introduce something that was an easy upgrade, they would introduce a minor version bump (e.g increase by 0.1.0), not a major version bump (increased by 1.0.0). The whole point of major version upgrades is that they break backwards compatibility.
Basically, smart choice to stay on UE4 if you've already developed on it
You heard wrong.
If you want some insight, Look up Everspace 2. They launched, have done well, and as part of doing well, have decided to make the jump from UE4 to UE5 as part of some of the stability their launch has given them.
As part of their journey, they have shared some write ups on some of the peculiarities they've run across as they've begun the long journey of porting from UE4 to UE5. The weird defects/bugs that cropped up on their journey of migrating from UE4 to UE5, including radical changes to how things appear visually, where they need to completely redo scenes.