It’s known behavior that, if you test a cloud flow that runs for longer than 10 minutes, you may get a timeout message in Power Automate, even though the flow continues to run in the background. If this happens, reopen the view to receive the current status.

Changing an environment type to sandbox will immediately reduce backup retention to 7 days. If you do not need backups (restore points) older than 7 days, then you can safely switch the type. If you think you may need restore points older than 7 days, it is recommended that you keep the environment as production and consider restoring to a different environment of type sandbox. Read more on the official docs here.

Backups for production environments that have been created with a database and have one or more Dynamics 365 applications installed are retained up to 28 days. Backups for production environments which do not have Dynamics 365 applications deployed in them will be retained for 7 days. Sometimes, this can be a bit confusing but, very important to understand the differences, read more from official docs here.