Finally… I figured this out after weeks/months since the issue happened again. Between then and now I have learned a lot about the Engine so bug fixing methodically and checking settings that I now understand better paid off. So, while the outcome was 64x64 textures and everything looked crap, it was nothing at all to do with shaders, or textures, or MIPs or LODs or Virtual Streaming, etc.
In my Engine settings, under General, the location of my derived data caches was set to a drive letter that didn’t exist. I had a portable SSD that I was using, which failed, then my new one created a new letter for the backup to be restored. The project loaded just fine, but the hardcoded path to the DDC locations was all still pointing to the old SSD. As soon as I fixed it and restarted the Engine, everything started working again.
Maybe this will help anyone else with this really weird and frustrating problem.