Ok. I'm a bit confused. Will we need to switch to HTML 5 or what we are already using work just fine?
You don't need to switch to HTML5, think of it as a version of a software, just because Firefox 3.6 is now the latest doesn't mean that Firefox 3.0 won't work. Obviously there are a lot of advantages in using the latest version of something but that doesn't obligate you to update.
It's very similar with HTMLx, they're just versions. HTML is a language and it also have versions (HTML 1.0, ..., HTML5). HTML5 is the soon to be latest version, it is still in its draft form, what that means is that anything that is defined in the draft may change. Also as any new version of anything it brings changes, removals and of course new "features" and improvements.
DTD are for the browser, it tells the browser that you made this page following the rules defined in the DTD. As there are 5+ versions of HTML and JavaScript, this tells the browser which versions are used on the page, so now it knows WITH CERTAINTY how to read the page and how to treat every element in the page.
whether you should or shouldn't update your site to be HTML5 compliant is a decision you need to evaluate. Ask yourself: what advantages does HTML5 bring to my site? Is there anything I want to do in my site that needs of HTML5 to be achieved? am I willing to invest the money/time necessary to make my site HTML5 compliant? is that investment going to pay off? etc...