I would bet that some mods will be completely unusable, but most mods will simply work to the point where they either crash the game ( the same way gnilbert's 1.08 mod does to 1.09) or will fail to give intended bonuses. I think it would have been nice if the devs had given the mod community some kind of early look at the xml files and the changes, so that we could already be working on updating our mods.

I recommend that you uninstall all mods. The orc and undead mod may work. The elf mod absolutely will not.

I'm sure this is true and that they will be updated in drips and drabs as the authors are able to get to them (as I say as soon as they have time) but it seems obvious to me that as they are changing resources and how mana and spells work as well as rebalancing costs some XML tags will be add/remove or change meaning. There is no way this won't cause issues with some MODS.

So as Heavensfall has said I think it would be sensible to remove all MODs when upgrading to 1.1 and either to re-add them later to see if they work or to wait for 1.1 updated versions to be published.

Otherwise you may find yourself reporting bugs with 1.1 that aren't there because your using incompatible MODs designed for an earlier version.

It's also confirmed in the beta patch notes it won't work with old save games. Not a shock given the scope of the changes.

The good thing about impulse is if I corrupt the game it doesn't take that long to download it and reinstall it and I can be doing other things while it happens. But anyway since mods aren't kept in the main game folders mostly it's easy to remove and reinstall them.