I admit it's been a while since I bought a new Mac but can you not boot older macOS from an external drive anymore?
In general, the oldest macOS you can boot on any given Mac is "the version the Mac shipped from the factory with". So, for example, the 2017 iMac Pro can't boot a 2016 or earlier macOS.
This is still unsupported, mind you — if your 2017 iMac Pro is firmware updated to 2020 and you're booting a macOS from 2018 on it, you may encounter random bugs and/or crashes and/or mysterious issues due to assumptions made by the older macOS that are no longer entirely valid on 2020 firmware — but in general, it should work as long as the macOS is newer than the hardware.
(You probably won't be able to boot an M1 macOS external drive on an Intel Mac, and vice versa, for other reasons unrelated to this. In that scenario, Migration Assistant is probably your only choice anyways.)
I did this several times because I couldn't believe what I was seeing. I can't say for sure where the source of the problem lies—maybe something is weird with my installation media—but my theory is that a firmware and/or microcode update subtly broke something in Apple's old installers, possibly when they added APFS support. I looked into downgrading the firmware, but it seems to be impossible from what I can tell[1].
Mind you, outside of this one quirk the OS and installer run fine.
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1: https://forums.macrumors.com/threads/guide-how-to-get-back-o...
With intel macs you can boot and install older macOS's up to a certain point. Like the previous poster says, it's about what firmware versions you have.
For example, if your mac came with Sierra, and through the regular usage and update, you patched it up to Mojave, and installed (or was forced to install by the way, there is no way to reject certain types of updates) firmware updates, you find that all of a sudden you can't re-install Sierra anymore. You'd need to install whatever version your firmware now supports.
This behaviour is undocumented and it's case by case - for each mac hardware there is a firmware for it - there are lots of people online who have figured out patch levels are for each revision of hardware, etc - but it's more trial and error to see what older version of macOS you can downgrade to.
I have never seen any record of this happening. I'm really quite sure you've always been able to install the earliest OS that your model of Mac shipped with.
The odd situation I mentioned above is the closest I've ever seen to a firmware update causing problems (if that's even the cause), and even then the OS runs fine.
There actually is a table of firmware versions, etc - once you upgrade your old Mac hardware past a certain firmware, you will no longer be able to run certain versions of macOS "before" the firware was supported.
This isn't just between "major" versions, also between "minor" versions of macOS
For example, between the current version of macOS Sierra, which is on 10.12.6 (6 being the minor version), if you try to install for example 10.12.x where x is below 6, etc - you might get the infamous ? or the circle with a slash through it on bootup.