Yes to the difference between the 26E engine and the Mi engine. I had a 26E and have flown a 31. If you operate in the flatlands the engine upgrade is not a reason to change, at low elevations the 26 has good take-off and climb performance (better than the more powerful and injected Arcus M which I fly now, but not as good as the DG 808). If you might need to cross high mountains the injected version would be much more suitable (there is no in-flight mixture adjustment on the carburetor 26E version) and of course the extra power is appropriate for the heavier 31.

The Schleicher gliders have used fine pitched propellers for best take-off performance since a few years after the 26 came out - the quoted ground roll reduced from 300m to 200m (from memory) when Schleicher changed the prop from the original Technoflug prop to their own prop. If you want to fly level under power for your self-retrieve the Arcus cruises faster than the 26, I presume as a result of a coarser prop.