I want to carry on using hangouts for sms I assume i can install an older apk before the sms integration timer was added, freeze updates and use hangouts for SMS forever.

I have two questions

1) how can i find the most recent version that won't have the warning message
2) where are my SMS stored, will i lose the history?
You can check previous versions at this link. You SMS are stored on your device locally. You can always change to another SMS application like Textra
or Default Android Messages