ReadyNAS Duo V1 Disk Upgrade - What did I do wrong?

You can't go back. You hot removed the drives one at a time and replaced them with 2TB drives. Each time the unit resynched, the drive you removed is no longer part of the array. In addition, the current smallest drive in the array is a 2TB, so the smallest drive it will currently accept is a 2TB. The drives you removed can be reformatted on the PC and used for additional backup/archival use. (Archiving is when you move data from the NAS to an off line storage. This would be for data that you may want to keep but do not need quick access to. Such a older financial files.)

I have several older drives that were removed and replaced with larger ones. I then installed them in a JBOD box connected to my PC. The JBOD box is off 99% of the time and only if I need to add data to one of the drives or access it do I turn it on. Don't forget to do a separate backup if you archive data.