Hello,
Yes, they are backwards-compatible. You can connect Thunderbolt 3 (USB-C) devices to an older Thunderbolt 2 port using an
Apple Thunderbolt 3 (USB-C) to Thunderbolt 2 Adapter.
Trasferring the data depends on how the SSD is failing, and what type of data is on the SSD. Is the external SSD used for data file storage, or do you have macOS Sierra installed on it as a startup disk?
You can simply connect both drives to the iMac and use the Finder drag and drop. But, it could hang the system if it encounters bad blocks/sectors. If that happens, there is a command to copy the data using Terminal, which will not hang the system and skip over the data that cannot be read/copied.
C