Replace an approved, unreleased version 1.0 build with a new build (TestFlight first)?

My first app (watchOS) has version 1.0, build 16, approved by App Review and set to manual release, so it is Pending Developer Release. It has never been released.

Since then I've added features (Apple Health workout recording) in build 17. I don't want build 16 released. I'd like to:

  1. Upload build 17 and test it with internal TestFlight testers.
  2. Submit build 17 for review and release it as the app's first public version.

Questions

  1. Can build 17 be uploaded as version 1.0 while version 1.0 (build 16) is Pending Developer Release, or will the upload be refused with ITMS-90062 ("must contain a higher version than that of the previously approved version")?
  2. If it's refused, what's the right path: reject build 16 myself (Developer Rejected) and then submit build 17 under 1.0, or change the version to 1.0.1 for build 17? Can the version number of the existing 1.0 record be edited after a rejection, or do I need a new version?
  3. Is it safe to try the TestFlight upload before doing anything to build 16? I don't want to lose the current approval by mistake.

Thanks for any guidance.