Hi,
Music purchased from iTunes Store contained DRM. This music could be burned to CD and reimported as MP3 or AAC. No point in importing as lossless or aiff as you would not get improved sound quality.
With iTunes Match subscription, you could up date purchased of matched tracks to 256 Kbps AAC. Note some purchases would become Matched and some would not be updated and remains protected. Lossless tracks are not available.
Apple Music includes iTunes Match features. However, you can stream or download music in lossless or hi-res but the downloaded tracks contain DRM. If you wish to upgrade you tracks , remove original lo-res tracks as 256 Kbps AAC then make a backup. You can then remove download then either stream or re-download lossless versions. You could consider using separate libraries Use multiple libraries in Music on Mac – Apple Support (UK)
You don’t use iCloud storage as both Apple Music and iTunes Match uses iCloud Music
ps You can’t convert Apple Music because of DRM
Jim