OP, good for you for trying to make use of a monitor you already have vs. just "throwing baby out with the bathwater" as so many do. I think it is terrible that monitor screens which can usually be good for 10+ years are essentially made obsolete because internal tech guts are "vintaged" as soon as about 7. IMO, a good consumer-centered move would have been to:
- maintain TDM all the way through latest iMacs vs. what is basically planned obsolesce in action OR
- make the tech guts easily upgradable like RAM was easily upgradable: pull the vintaged iMac on a card and plug in an up-to-date iMac on a card (or similar).
While either of those seem best for us customers, neither is the more profitable way... and we know how the clash of profit maximization vs. long-term customer utility tends to go.
While it looks like you've about got a complete answer to your question, I'll share one more option to expand the usefulness. If you want to go to a bit of trouble, you can basically hack an iMac into being a 5K monitor that WILL work with latest Silicon Macs (too). There are many videos about this on YouTube like this one...
Key here is that instead of having the iffy relationship with "will (old) TDP work?" this just makes an old iMac into a monitor. If TDP gets you frustrated and/or a desire for newer Macs that aren't TDP friendly sets up this "problem," this solution might let you squeeze every bit of use out of a good screen for a lot less cost than buying a new ASD or even the
Samsung Viewfinity S9 "clone" just about to hit the market.
And don't be concerned with the $600 in the title: he didn't already have the iMac he used. Most of that $600 is buying the used iMac. You already have one.