(1) "OK to install OS 8, it will give me the Gateway, then I just use my disk to bring it back up to current Win 10 level."
(a) We don't know you'll ever find that button to start the thing. I think there is a special F-key that will get to a menu from which you may make the selection. It's also possible "Troubleshoot > Reset This PC" will do it instead of resetting to the most current Win 10.
(b) Your first trek from Win 8 to 2004 was gradual through all the intervening versions. Many changes came to OneDrive, the Store & its apps, the browser, etc., bit by bit, not to mention the driver changes. Doing it all in one fell swoop from Win 8 to 2004 might involve too many gyrations to succeed.
(c) Why even think it, when we know you can make & restore Win 10 images of your own that are fully updated & fine-tuned to your purposes? You should make periodic images with your go-to image maker. And make one less frequently with a secondary image maker, just in case Acronis should fail the next time you really need it.
(d) It's OK to let partition 6 just sit there except for one thing: Windows has chosen to put its new WinRE.wim's into it. That makes it the official Recovery partition. And a fit & proper system image backup includes EFI, MSR, Windows, & Recovery.
The Recovery partition need be only around 800 MB in size -- but yours is 15.72 GB! That is the main reason your Acronis .tib is enormous compared to mine. Also, you don't get the same compression ratio I do I guess because an Install.wim isn't amenable to it. So my 40 GB of used space compresses to half that much, & yours compresses just slightly. And your Windows system image backup would also be huge & slower to make. But it still really shouldn't be hours to make, I don't know what's up with that.
Therefore, at least we should make partition 5 the active Recovery partition. Then partition 6 will really just sit there. You may make a separate image of it just once, then forget it. But the Recovery partition needs to be included in every fit & proper Windows system image backup. That is why it was selected for you on page 2 of this thread & could not be unselected...
BTW, the MSR partition doesn't show up in that list, but it is included into (C:) & separated out during a restore operation.
(2) "I have never backed up unallocated space."
I think we should delete, then recreate partition 5. That might shake things up under the hood to make Acronis start to like it. I really don't like the fact that Acronis gives that error message even though you unchecked "Back up unallocated space". We know for sure CHKDSK said all the occupied sectors were supposedly good: "0 KB in bad sectors".