The single-sig wallet will still work. Each key can be used in multiple wallets (singlesig or multisig) without interfering with the others. However, for a more secure multisig setup, it's usually better to generate separate keys on different devices or at least different wallets. It is generally considered malpractice to use your singlesig key in a multisig wallet. If you are distributing your multisig coordination information to cosigners, they will have access to your personal public key which you likely don't want to disclose. Also, if someone gains access to both Key #1 and Key #2, they can control both the singlesig and multisig wallets. Typically, the idea of a multisig setup is to spread keys across different devices or locations to increase security.
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