This is the fallout from a deliberate change in TB146. Quoting the the developer who thought that would be a good idea:

"Regarding the folder names changing, that was a conscious decision and a wanted change to mitigate the problem of inconsistent naming from different servers."

Stop trying to rename the folder now called 'Archive', it's still 'All Mail' on the Gmail server. Presumably the change affecting 'All Mail' will be reverted in the next version of Thunderbird. If you're patient you may just wait for the fix.

For the time being you can check whether you set 'All Mail' as the Archive folder for your Gmail account. At the top right of the Thunderbird window, click the menu button ≡ > Account Settings > Copies & Folders > Message Archives Uncheck the box 'Keep message archives in' for the Gmail account. Does the problem go away?

Alternatively you may simply unsubscribe from 'All Mail'. It is redundant, and just adds to the size of the profile. Select the Gmail account in the folder pane. From the main menu bar: File (Alt-F) - Subscribe uncheck 'All Mail'

I ended up unsubscribing from All Mail, renaming was still blocked though even when I unchecked the folder as the archive folder. Do I need to do something to reduce the size of my profile after having unsubscribed?

After unsubscribing you shouldn't see the 'All Mail' folder anymore in the folder pane.

First of all, create a backup of your Thunderbird profile. See https://support.mozilla.org/en-US/kb/profiles-where-thunderbird-stores-user-data

Don't use the export tool, just follow the manual steps as per the support article. Remember the location of the profile for later.

Shutdown Thunderbird.

Now check the size of the 'All Mail' folder in the file system using Windows Explorer. Navigate to your profile folder in Windows Explorer. Then go to ImapMail - imap.gmail.com Inside the imap.gmail.com folder there should be a file 'All Mail' without a file extension. What's the size of that file?

There should also be a file 'All Mail.msf'.

If you think it's worth to recover the disk space these two files are using, you can delete them while Thunderbird is closed.

Then start Thunderbird again, and verify all your mail is visible.