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We are updating several SQL Server 2008R2 instances to SQL Server 2012 SP3 CU2. I know that the database versions will be changed from 100 to 110 during this process (e.g. once finished, the databases can no longer be moved back to a 2008R2 instance).

Does this change to the databases occur during the upgrade itself or the first time that the databases are brought online when the server restarts?

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The database version is updated automatically, when the database is first brought online, during the recovery process.

The database compatibility level is never automatically modified. If your database is at 100 now, that won't change.

Refer to https://msdn.microsoft.com/en-us/library/bb510680.aspx for database compatibility.

See https://blogs.msdn.microsoft.com/sqlserverstorageengine/2007/04/26/whats-the-difference-between-database-version-and-database-compatibility-level/ for the differences between version and compatibility level.

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