No, there’s no need to erase everything. Is enough just to reset the user data and start with a fresh wallet, keeping the blockchain sync.
But… if your node has a problem on that data (could that the reason is not starting well), then is better to start fresh with new download of blockchain. I know is painful to wait, but is the best way to be sure is clean. Data corruption always endup in days of frustration and waiting, when you could just start clean.
In Umbrel troubleshooting manual there’s a section that explain how to reset user data and start with a new fresh wallet, user, password, seed etc. but keeping the blockchain.
Yes, I strongly recommend to take your seed + channels.backup file into your mobile device with Blixt and recover your funds. That is the easiest way, meanwhile you are rebuilding a new Umbrel node.