gaining measly 20% of former Ukrainian SSR
It would be a third of Germany, or half the UK - if that helps see it in a different light. But a third of Germany, or a half of the UK - that contains more mineral wealth than Germany and the UK combined.
switch their entire economy to war mode, increase military sector production, build huge reserve forces and just stop now
This is a different question. There is certainly a big element of inertia. I already listened to some discussions among Russian economists, regarding the impossibility of rapidly switching off the war machine without causing massive economic problems. The war machine forces its own logic on things, and here you are making of course a very good point.
But the way I see it, is that this is a problem that will need to be addressed. It was necessary to do, because otherwise we would lose this war in Ukraine. It pumped up our muscles enough to convince the Europeans and Americans it was not possible to eject us. It doesn't mean we have to keep feeding this dragon until that point when he eats us all.
It has to be switched off, but gently, carefully.