Roth IRA Conversion and taking money out

There would be a 10% early withdrawal penalty on the amount withdrawn from the Roth IRA. You are correct that earnings are taken out last, and in this case there are no earnings, but no contributions either. There is only conversions, and taxable conversions withdrawn in the first 5 years are subject to the 10% early withdrawal penalty (but no tax).

This would not meet the requirements for a qualified distribution because although the owner is over 59.5 years old, they have not had a Roth IRA for 5 years. So it's a non-qualified distribution and the tax and penalty is determined by the ordering rules. If they wait 5 years after converting before withdrawing, then it would be completely tax- and penalty-free.

Also worth pointing out that converting 1 million dollars in one year is probably a terrible idea unless they are extremely wealthy. It's better to convert a smaller amount each year to keep the marginal tax rate down.