I personally define the terms by their semantic meaning -
Preservation - to preserve something is to make sure it stays in its current state - so scanning the film, not cleaning it and only correcting the colors to what is on the print is a preservation.Restoration - to restore is to return something to a previously existing state - in this case then it would mean to scan the print, color-correct it to original colors, if there’s fading, and clean any dirt and scratches that happened to the print itself.
Alternatively restoration could mean to use whatever sources to get to the quality of an earlier generation copy but not to get something that is better than the original copy when it was new - anything beyond that isn’t, at least semantically, a restoration any more, so from this point of view, Legacy is neither a preservation, nor a restoration - the closest term IMO is Remastering - creating a new master, which may well be better than the original master.
I think you are petty close on that. Remastering is what Lucas did with all the recomped effects shots that really don’t look much different, but subtle flaws are removed, such as the slightly transparent snow speeder cockpits. Mike is doing much the same thing except he doesn’t have the original components and is attempting to do it by isolating and fixing each component in the shot.