I updated gamestudio to 6.40 from 6.3 and the FPS i was working on for 3 months does not work anymore???
Can somebody please help?

Probably means you'll have to change some of the c-script ços it is outdated or get rid of the update...

Another question, if I publish it and download an update, will it work?

Nope,
Would i have to download the new templates?
I haven't.
Most of the errors are with the gid.wdl and display00
something is wrong.

i cant really help but i do know that when you update some old freatures are updated
so you may have to change some of the script you have to the new updated script
sorry im use less

I would try and download the new templates.

IF NOTHING works and NO ONE has a better solution I'd make a copy of your gamefiles to a different location then deinstall Gstudio and reinstall and update to 6.3 (available somewhere at the bottom of the download page)

Good Luck.