Jupytext adds a menu like this:

So we would add a similar menu and on the backend we would add an extra hook that runs jupytext after saving to ipynb (and when loading as well).
There's an interesting discussion about notebook formats here, and my takeaway is that the best thing for cocalc to do is just make it as easy as possible for people to use jupytext. Another ticket motivated by that discussion would be to use nbdime (and/or jupytext?) to improve the diff view of our TimeTravel viewer for Jupyter notebooks.