AFAIK, they go out the airlocks. Pretty much the only time I'd upgrade a ship with population capacity is to take a resource mine, but I always try to land somewhere with room for the people and launch with only 1 pop unit aboard before upgrading to constructor.

You can but AFAIK the only way to do so is to upgrade all of a class of ships. You can't upgrade a single ship in orbit, you have to launch it to be able to get to the ship details menu where you can actually select "upgrade". Just do as GW suggested which is to off-load the pop and launch with only 1 pop unit.

As an aside this one pop unit is 1M population, it seems strange that it requires 1 million people to pilot an empty colony ship, particularly since if the ship was built as a constructor to begin with it would not have reduced the planets pop by 1M to launch it. However, it is a game and the ability to suspend disbelief in order to abstract from game mechanics is essential.

It never remotely occurred to me you could upgrade your miner to a colony ship, but now that I think about it, I think I will stick with mining. That extra 3-4 ip can be the difference between putting out a colony ship every turn vs. every other turn.