The limits of rebuilding old capital ships

Would retaining and oil-converting older battlecruisers be better than keeping older battleships?

It could be interesting, but modernization cannot fully overcome an old hull's original internal and technological limits.

New machinery cannot wholly overcome the internal arrangement of older ships such as Lion, Princess Royal, and Tiger. Each hull was laid out around the technology available when it was designed. A refit can adapt that arrangement only so far before the old design stops keeping pace with newer ships. Reconstruction may improve a capital ship without making it the equal of a clean-sheet design.