I fully expect this whole renovation metaphor to play out very quickly.
Before getting into the mechanics of porting the modules from the old ruleset to new, there are a number of decisions to be made. Dungeon Fantasy embodies different assumptions about play than AD&D. Specifically, Dungeon Fantasy intentionally abstracts away town time and really anything that isn't directly dungeon delving itself, assumes competence out of the box, and the tone is at least a little silly.
Town: The Temple of Elemental Evil has three of these, actually. There's Hommlet, Nulb, and Verbobonc, the last of which is the nearest large city at half a week to a week away. Verbobonc is the easiest; it's outside the scope of the adventure, and it's large enough to have anything the adventurers might want, so I'll just use the DF rules straight - I've no interest in fleshing out a large city. Furthermore, it's large enough I can just assume that most things desired are available, which isn't the case with either of the two villages. That gives the party an incentive to go there, but it's far enough away that they won't want to stay there, since a week across open country is expensive and potentially dangerous. (The area is mostly lawful, but with the resurgence of the temple, the Prince is seeing an upswing in complaints about banditry and roving bands of demihumans.)
Once the party gets to Nulb, they have a choice as to where to stay. That means that I need to differentiate the two somehow, in a way that doesn't make one clearly the better choice. Nulb isn't treated with the same level of detail as Hommlet, either; mostly because by the time the PCs have moved on, they have a large dungeon to focus on, shifting away from town adventure.
The flavor of the two should certainly be different; the module makes this clear. Nulb will be dangerous, with brigands even possibly assaulting the PCs in the streets, if they come back weak and loaded down with treasure. It's a hive a scum and villainy. Why would the PCs ever stay there instead of Hommlet, where not only is it safer, but they're already well-liked by this point?
First, Nulb is a much better place to pick up hirelings. The only hirelings available in Hommlet are some adventurer-types who want far too much coin, a limited number of laborers, and one priest from the temple of St. Cuthbert who I'm throwing in as a backup healer if the party wants to take him along. (I firmly believe no one should be forced to play a cleric if no one wants to.) In contrast, in Nulb you can find the entire gamut of hirelings available in DF 15 - Henchmen (which I picked up yesterday and highly recommend for anyone who actually wants the sort of game where PCs hire people).
Second, Nulb is closer to the dungeon, being only half a day's journey over relatively safe ground from the Temple of Elemental Evil. From Hommlet, you travel for a day and a half, and you either cut through a rather dangerous forest or go through Nulb anyhow.
Third, you can get some things in Nulb you can't get in Hommlet. In Hommlet, there's no potionsmaster. There's a druid, to whom you can go for 'natural' potions (like monster drool poison and antivenin) - if he likes you - and there's a mage who will sell various small magical consumables, but no potions. Since Nulb is larger, I'm willing to abstract away buying most mundane goods, even those of quality (though you may have to wait a week in town if you order something particularly rare). Weapons and armor, in specific, are available, being mentioned by name in the module. In addition, if you need strong clerical magic, Nulb is the place to go, since the main priest of the Temple of St. Cuthbert in Hommlet is away. Also, sponsorship is easier to get here, and Nulb offers some training options not possible in Hommlet (clerics, holy warriors, thieves
Finally, Nulb is the only place for PCs to pick up rumours about the dungeon. People in Hommlet don't know much about the Temple, and they don't want to know.
One way in which Nulb is not going to be different is cost of living, which will be $150/week for each PC (plus cost of hirelings). In Verbobonc this is standard. In Hommlet, the Inn of the Welcome Wench is both the only gig in town and specifically mentioned as expensive. In Nulb, the food and lodging are cheap, but the extra money goes toward garnering rumours, being scalped for non-food sundries (cleaning your clothes, caring for your horses, etc.) and hiring guards to watch your stuff while you're asleep or paying protection money to some of the bandit gangs. If PCs think to ask, they can skimp on this, getting by on $100/week instead of the full cost, but they won't get a rumour and the chances of being attacked and robbed while in town will be substantially higher.
Hommlet at first will be much like written in the book, because T1 is in large part about the town adventure of finding the place the PCs need to go, feeling out the local politics, and inserting themselves successfully into the village. In short, for a little while Hommlet is the site of the adventure, and should be detailed as such. However, once PCs get to/through the Moathouse and/or resolve the tensions in the village, I want to largely abstract it away as a distraction from the dungeon.
Hommlet offers several advantages over Nulb. It's basically safe, with little to no chance of people being assaulted in town, and random encounters happening nearby only on a lower chance (6 or less instead of 9-12 or less, I'm thinking), and not all being bad besides. There's a temple, traders, money-changer, druid, and wizard's keep, along with various craftsmen, meaning most mundane needs and some magical ones (including healing and charging power items) can be taken care of. Some templates can only get training in Hommlet. Finally, what hirelings that can be found here are likely to be more reliable than those in Nulb.
A last note about training: T1 and T2 are very specific about the people that are in Hommlet and Nulb, and T1 is very specific about those that aren't in Hommlet. To that end, the two also differ in what PCs can find training in the two places.
Hommlet: Barbarian, Druid, Knight, Scout, Wizard
Nulb: Barbarian, Bard, Cleric, Holy Warrior, Knight, Scout, Thief
Yes, this will create some tension in where people want to spend their weeks. This is intentional. However, I don't want this to be crippling, either, so I'm ruling that you can still spend points in your template when you spend time in a town without a teacher, but not for new spells or primary skills (ones you already have are fine), nor power-ups or primary abilities you don't already have points in. Thus a Knight couldn't learn a new weapon, but he could train with the one he has, and a druid couldn't purchase a new animal companion, but he could improve spells he already has or dump more points into Power Investiture.