How to change date format of a custom entity in an update hook?
When I changed base fields in the past they always updated in the plugin definitions on a cache clear. Also if this involved a schema update, by the way, which then produced a warning on the status page that there is a mismatch with the database, for which you then would need what you've described in the question.

In your case, though, my guess would be that the new settings are not valid for a timestamp field. The field formatter datetime_default is probably only working for a datetime field. 

So try to change the field formatter in the base field definition to:

    'type' =&gt; 'timestamp',