My old iPhoto is on the external drive. The current photos app is on the upgraded computer
Photos for Mac can only migrate an iPhoto library, if the external drive has a file system, that supports hard links. How is your external drive formatted? If the file system is not MacOS Extended (Journaled), move the library to a correctly formatted drive, save all other data on that drive as well and format the drive with Disk Utility. Formatting erases the drive (this support document explains how to format a drive to use with photo libraries: Format external drives to Mac OS Extended before using with Aperture - Apple Support)
I opened the photos app and the iPhoto library was greyed out. I opened iPhoto on the external drive and it wanted to start a new file. I found the iPhoto library on the external drive and dragged it to photos and it said it can't convert the images.
Don't try to import your library from the "File > Import" panel. You can drag the iPhoto Library onto the Photos icon in the Dock or
use the library Chooser panel to switch to the iPhoto Library. Hold down the alt/options key while launching Photos. Select your iPhoto Library from the Library Chooser panel. If it does not appear there, you're drive may not be supported.
I may be able to double click on the iPhoto library and it will open the images in the iPhoto app that is on the external drive. But, I'm not sure where to go from there.
You can use both applications, Photo for Mac and iPhoto. when Photos migrates the iphoto Library, it will create a new library on the same drive. On no account delete your iPhoto Library or uninstall iPhoto until you have worked with Photos for some time and are sure, you do not need iPhoto any longer for emergencies, like repeating the migration, if something went wrong.
Photos and iPhoto are sharing the image files in the libraries and don't duplicate the files. See: Photos saves disk space by sharing images with your iPhoto or Aperture libraries - Apple Support