I live in an old MA farmhouse built in 1890. I have a second story over about half of the house and a 3.5/12 shed roof that descends to the back from midway between the first and second floor. This roof changes pitch slightly about 3/4 of the way down where it covers an added sun room porch. The porch has skylights that are leaking. The rest of the roof does not leak now. It is covered in rolled roofing. The roof covers a 28’ x 20’ floor area with the 28’ dimension across the connection with the house.

The second story of the house is now gutted. The walls will be insulated with either cellulose or mineral wool. Everything I have read points to cellulose so I am leaning that way. I can see into the shed roof attic because the partition wall separating the attic from the second story was only insulated with poorly installed fiberglass batts that I removed. The floor in the attic is covered with about 14-18″ of fiberglass batts. Both a bathroom and a kitchen are below. This attic is not currently vented. I do not see any significant signs of moisture issues on the rafters or sheathing. There are mice in the house and it is likely that they have lived in the insulation at some point. The drywall below was poorly installed and will either be replaced or layered over later. I want to install downlights in the kitchen ceiling when I renovate it. I know that it is a bad idea to have can lights in an unconditioned attic. I want to air seal this attic at some point as well.

I am looking for opinions, for a sanity check, and for perspective. I need to decide what to do about this attic space because it will be easier to deal with now while the wall is open. These are the options I have come up with
1) Leave the thing alone and do as little as possible – it is already insulated, doesn’t have moisture issues, and the loss from air leakage isn’t significant enough to mess with it. I will still need to sheath the kneewall on the attic side with rigid foam to hold back the insulation that will be installed in the adjoining second story wall. This will be a pain because I will have to pull back all the fiberglass to air seal the foam at the bottom and it will have to be cut around joists/rafters at the top and the bottom. I would also considering adding venting of some sort (tricky with attached shed roof).
2) Make the attic conditioned space. This gets rid of all the insulation in the partition wall. It creates a storage space; I don’t have much storage currently. It lets me add downlights in the kitchen. It makes bath fan venting easier and less risky. It makes wiring below easier. I thought of spray foam but it is way too expensive. Next I thought of tearing off the rolled roofing, adding reclaimed polyiso from one of the recycling centers, then furring and screw through metal roofing. Then insulate between the rafters with something. I ran some numbers, this would be much cheaper than the spray foam and it would get rid of the rolled roofing and leaky skylights. This would cost a lot more than leaving it alone.
I’m sure there is information I left out. Any help is appreciated. Thanks.