Why Britain could contemplate broad capital-ship modernisation

Could the Royal Navy have modernised the machinery of more older capital ships once treaty restrictions eased?

Yes, if funded; Britain already possessed unusually extensive maritime infrastructure in 1937-39.

Britain was uniquely well placed to renew capital-ship machinery after treaty limits weakened, provided it supplied the money. Much of the United States' enormous wartime maritime capacity was built between 1939 and 1941, while Britain already had substantial infrastructure available in the late 1930s. Japan then waited until 1941, after American industrial expansion had transformed the balance. Modernisation potential depended on existing yards and timing as much as engineering design.