My note fund is inside a regular brokerage and I keep wondering if moving a slice of it into an SDIRA would actually make sense

The framing you laid out is basically right, and most people skip past it too fast. Ordinary income in, ordinary income out, the wrapper doesn't launder the character, it just moves the timing. Where it actually starts to pencil for me on the note side is when you're looking at a high-yield fund running 10 to 11% on performing seconds or bridge paper and you're reinvesting everything. The compounding on the deferred portion is real over a 15 to 20 year horizon even if the exit rate is the same as the entry rate. I ran a rough comparison on $150k at 10% compounding with no shelter versus the same thing inside a traditional IRA at a 37% bracket going in and a projected 24% bracket in retirement. The gap was meaningful, somewhere around $60k over 18 years, purely from the deferral and the assumed rate drop at distribution. Not life-changing but not nothing.

The thing I'd want to nail down before moving anything is what your realistic bracket looks like at distribution age, not just today's bracket. If you've got other income sources in retirement, Social Security, a pension, other IRA RMDs, you might not drop as much as you're hoping, which compresses that gap fast. The Roth question I'd reframe slightly: instead of converting now, I'd look at whether you can direct new contributions or a small rollover into a Roth SDIRA and let the note income compound tax-free from a lower basis rather than converting a big existing chunk at 37%. The conversion hit is what kills it at your bracket, but accumulating fresh dollars in a Roth while leaving the existing fund where it is might thread the needle better.

Yeah you're not wrong that it's mostly a timing trade with ordinary income on both ends. The depreciation shelter is basically the whole reason the traditional SDIRA math looks clean for rentals, and note funds just don't have that lever. The thing that does change the calculus a bit is compounding on the gross interest for decades without annual tax drag, and at high enough yields over long enough periods that actually does move the needle, but you'd have to model your specific yield against your expected retirement bracket to know if it clears the bar. For me the question I'd want answered first is what bracket you realistically land in at distribution age, because if it's still 32 or 37 you've essentially deferred into the same problem.