The downside of changing the iPhone setting to 'most compatible' is that it will eat up your phone storage space quickly.
Apple switched over to HEIC in order to give users more storage space. There is quite a big difference between JPEG and HEIC. You will find a 64GB iPhone plenty sufficient nowadays because of HEIC, or a 128GB if you shot a lot of videos.
Freezing error
No resetting of my iPhone or PC resetting required.
I could not transfer over my photos/videos from my old iPhone 7 Plus. But once I switched the setting to 'keep originals'. The import method transferred everything in one go without any issues (5,496 files, 27.3GB).
Yes - You do need to download a plugin that will let Windows open these HEIC files. I did manage to find the free Windows plugin so all is well.
It appears for me, Windows did not like the 'automatic' setting on my iPhone, but was happy to imported all the original HEIC files.