There is no Notifications option in project settings. How do I assign a notification scheme to my project or modify the current one?
You can change the scheme under Project Settings -> Notifications -> Actions -> Use a different scheme as shown in the attached animated gif.
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See the other accepted answer above.
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I would guess you created a "next gen" project, which currently have fixed notification schemes.
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Is it easy to convert to a project type that does not have a fixed notification scheme?
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No, I'm afraid it's not easy. Possible, but a faff.
You have to add a new project (any type other than "next gen") and then use bulk-edit to move any existing issues from the old project into the new one.
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