The two methods gave me a difference in brightness/contrast.

Note: this is a 1080p reencode from UHD-4K content. So our goal is to create what would be best to watch in 1080p, I guess calling it "SDR version" is the proper term. We will also assume there isn't any official Blu-ray, created by professional colorists, which is obviously going to be better than whatever we do automatically with this app.

What I can't figure out is which is correct, in the end. The answers at least from AI, were conflicting. It hinted that file #2, which I created later and has less brightness/contrast, may be better.

Reencodes using H.265. The #2 one with a higher bitrate, uses BT.709 and 10-bit for HEVC.

Take a look:

ORIGINAL UHD-4K file (MKV, lossless):

https://pastebin.com/VTmh1Cir

NOW, the file with less bitrate, and increased brightness:

https://pastebin.com/Eqzhb5cF

The #2 one:

https://pastebin.com/cPusHwcD

Any ideas?

+++++++
One thing I learned is that if we disable colourspace for a 4K - 1080p reencode, the final result is 8-bit and clearly bad/wrong, with video artifacts.

Another change I made was to set a fixed bitrate for HANDBRAKE, and disabled "anamorphic".