I understand that 3.7.x camera profiles (e.g., Magne Nielsen's excellent custom profiles) work fine in v5. Is this correct?
Yes, this is correct, based on what I have read on-line and from my own trials. Please note that the Magne profile will appear in the "other" menu option on the camera profile main menu, NOT the menu selection for your specific camera.
AFAIK the Magne profile will also not be automatically offered as an option along with the V5 profiles, you have to go to the "other" menu and select it.
And if so, does it mean that v5 profiles will similarly work in 3.7.x?
That I don't know. But as you mention in your second message, you can just try and see what happens.