You can turn co-location on or off at any time.  It will not re-organize
anything at that time.  What will happen though is that all future tape
migrations and recycles will honor the new settings.  Thus over a period
of time you will evolved from a colocated system to non-colated or vis-versa.

Colocation happens at tape writes and tape recycles so you can gauge your
evolution time period by this.

Paul