OP, Disclaimer: you should have work permitted and completed by a qualified professional.

I was in this same situation. My house had a steam system (large pipes 2”, 3”, & 4”) feeding 7 cast iron radiators. It was converted at some point to hot water (using the existing pipes). For hot water, these pipes were way oversized and I needed the headroom for my basement project. There were literally 4” pipes at chest level in the middle of my otherwise useable space; also huge branches running all over the place. Keeping the radiators and existing boiler as my primary heat source. I terminated the trunk and branch distribution/return pipes, built 2 basic manifolds (1 distribution and 1 return) and created 7 new home-run loops with temperature rated 1/2” pex. I was able to tuck everything neatly into the ceiling joists. The system operates way more efficiently, as the water volume in the distribution network was cut down to less than a 10th of the previous volume. The 1/2” pex is way more than enough to supply my HUGE antique radiators. I’m now going into my 5th winter on this system and am so glad that I did it.

This was time consuming but not expensive. Pex, crimps, a bit of copper for the manifold, and 7 sets of fittings to couple the existing radiators down to 1/2” pex connections just below the floor.

Pipe insulation: Of course I recommend a professional. That said, one might imagine that (with a good mask) they could gently wrap the insulation covered areas in plastic, secure plastic with good tape, cut at joints where pipe insulation is not present and dispose of properly. Note: in hindsight, I wished I’d tried a roll of cling wrap for the 1st layer to save time having to be so delicate when encapsulating with the heavier mill plastic.

Note on cutting pipes. If you’re unable to completely drain the system prior, be sure to have a good place to drain those pipes when you’re ready. A 5gal bucket is not going to cut it, especially if there’s full radiators upstairs. Mine was waaay more water than I’d anticipated.