I back up the whole of My Music folder which also contains the itunes folder. When I reinstall Windows,which is fairly often in my case as I always seem to be upgrading one component or another, this week its the motherboard. After reinstalling Windows and then reinstalling itunes I then copy the complete contents over from the old itunes to the new itunes folder. I have never been ask to convert.
So I am thinking that some setting needs changing or has been changed in your case,though I cannot think what.