Can I convert subcategories to tags without losing data?

A category and a tag aren't the same thing, so you wouldn't "replace" a sub category with a tag.
Instead you would tag the sub category transactions and then you would change the category to something else like the parent category.

Ctrl+H to bring up Find and Replace dialog.
Search with Category, Exact, and then the Sub category.
Select Replace Tag and put in the tag you want in the With box, and then Replace All.
They change Replace Tag To Category, and in the With box to the category you want, and then Replace All.