I heard about that too. It’s kinda funny since I remember getting a comment on the trailer I did on youtube saying something along the lines of “The digital files can just be re-rendered at any resolution”. Looks like thats not the case.
Apparently the original files are just gone, apparently they had digital backups of all their movies and their backups failed. Pixar also keep their original digital files for the first two Toy Story films and just re-rendered the film at 2K / 1080p for Blu-Ray which was a smart move IMO.
Jonathan Gibbs says “Shrek was rendered on SGI IRIX systems. It was mostly in-house software and the code still exists. Technically possible to rebuild and re-render but you’d need experts in how it all worked back then and a lot of time.” and that there wasn’t even a proper Digital Intermediate for Shrek. But after they moved to 12-bit JPEG at 4:4:4, Megamind used OpenEXR etc.