Unpublishing should not terminate instances, but it does prevent users from completing active users tasks and things like that, so typically when I'm retiring an old version I do the following:

1. Change the URL to something random/obscure
2. Remove all submitter rights from the form

That way no one can start a new instance and I can re-use the original URL for the updated version, but I also don't have to worry about active instances.

Remember that you only need submitter rights to START a process, not to participate in user tasks, so even if you still have tasks pending/in progress they'll work fine even if no one has access rights to initiate the process anymore.

Once all active instances are complete, then I go back and unpublish.