Funds sent to Fidelity generally go into a money market account that presently has about a 5% APR. $5.40 would be 6 days of interest at that rate.
You can convert as little or as much as you want.
The conversion would be reportable on the tax return for the year in which the distribution from the traditional IRA occurs. As you said, it's too late for that to happen in 2023.
If you leave the money in the traditional IRA instead of converting to Roth, investment gains will be taxable instead of eventually being nontaxable once the requirements for qualified Roth IRA distributions are met. The $6,500 traditional IRA contribution for 2023 is reported on your 2023 tax return the same whether or not you convert any of it to Roth.
The only potential downside to not being able to convert until 2024 is that it delays the beginning of the 5-year conversion clock by one year, but if the Roth conversion is entirely nontaxable due to the distribution from the traditional IRA consisting entirely of basis in nondeductible traditional IRA contributions, that really doesn't matter because there is no penalty on a distribution from a Roth IRA consisting entirely of nontaxable conversion basis.
