Electronic – What grade of fibre is used in optical fibre displays

Let's say you transmit at 10 Gb/s. Then the bit period is 0.1 ns.

The index of refraction of glass is about 1.5, so the speed of propagation through the fiber is \$c/1.5\$, or about \$200\times10^6\ \mathrm{m}/\mathrm{s}\$.

So each bit occupies about 20 mm of length, and there are about 50 bits "in flight" in every meter of fiber.

If you want to know what happens when you use the "maximum data bandwidth" of the fiber, you'll have to define what you mean by that. In practical systems, the bandwidth isn't limited by the fiber but by the transmitters and receivers at each end. The number of wavelength division multiplexing channels that can be used is limited by nonlinear behavior that occurs in the fiber when the total power (across all channels) gets too high. So even that limit depends on the sensitivity of your receivers (which determines how low you can make the power in each channel).

Multi-level codings allow you to send more bits in a given frequency, with the trade-off of needing more complexity to generate and detect the multiple levels.

At the time the 100mbps Ethernet copper standard was being developed, this obviously felt like the right compromise of interface complexity vs demands for cabling of a particular quality.

Standards like Ethernet are an immensely complex balancing act of backwards compatibility, politics, vested interests and attempts to predict future demand. You can't really pick one of umpteen overlapping engineering decisions and say 'why did they do that?', because the answer is always at least in part 'because they did all the other stuff'.

In answer to your specific question about recoding stuff, then yes, you can always do that, because if you can decode one format and generate another, then you can put those circuits back-to-back.