I recently upgraded a movie with a low collection number (#3) from Blu-ray to 4K and plan to remove the Blu-ray from my library. Is there any way I can automatically shift all subsequent collection numbers down by one so there's not a gap? It seems like I can increase the subsequent collection numbers by one, but I don't see an option to decrease them. I'd rather not manually re-number all the movies in my collection, and if I leave them alone then it will try to fill in the empty #3 slot every time I add a new movie.

It would be wrong, but you could change the purchase date of your 4K to the same as the original Blu-ray, then Re-assign Collection Numbers by Purchase Date. You could put the purchase date of your 4K into its notes in case you don't like that and want to change it back. Perhaps back up your collection first, in case the re-numbering causes undesired changes.

I've also created a Collection list called "Previously Owned" where I move stuff out of my Owned collection.