SUMMARY
When I change the location of a default path in System settings→Applications→Locations, I usually do this because I want to rename the actual directory. Another use case is the default paths having been created with English names before I could switch the workspace to my local language.

So if the old location exists, then a dialog would be nice:
„Shall the existing directory be moved to the new location?“
And if the new location already exists, just confirm whether to move the contents into it, especially if the destination is not empty. Maybe even use the same dialog for that as when moving something in Dolphin, so we get a nice progress indicator for longer operations.

SOFTWARE/OS VERSIONS
Operating System: Arch Linux
KDE Plasma Version: 5.24.3
KDE Frameworks Version: 5.91.0
Qt Version: 5.15.3
Kernel Version: 5.16.11-arch1-1-surface (64-bit)
Graphics Platform: X11
Processors: 4 × Intel® Pentium® CPU 4415Y @ 1.60GHz
Memory: 7.7 GiB of RAM
Graphics Processor: Mesa Intel® HD Graphics 615