Hello @BillSmith ,
Thanks for your feedback.
Currently, Earth will not convert or edit the Collada models while importing them. Different from ArcGIS Pro, Earth will not automatically convert the DAE file to feature or feature classes. We will consider adding this workflow in the future.
As the model can be visualized in Google Earth, could you please share it with us via ArcGISEarth_Feedback@esri.com if it's not confidential? We will investigate it as soon as possible.