In case it helps, my notes about how to manually enable the V2 data engine on Harvester v1.3.x are in a comment at
https://github.com/harvester/harvester/issues/5274#issuecomment-2217187470
I'm rather surprised that checking that box in the Longhorn GUI would break etcd/k8s, so, yeah, as Cooper said, knowing what version of harvester and longhorn you're using would be helpful, and also any relevant logs or error messages.