Would it work to delete the Rancher-Manager Addon in Harvester (keeping the Longhorn volume for it), then re-adding it back?

there's some discussion about that in https://github.com/harvester/harvester/issues/7284 and, yes, the data should not automatically be deleted (see https://docs.harvesterhci.io/v1.5/advanced/addons/rancher-vcluster/#troubleshooting)

Guess the dependency on loft's upstream chart needs migration steps to actually upgrade without data loss.