I've put 6s freewheels onto many old 120mm hubs with only having to move a ~1.5mm washer from the non-driveside end of the axle to the driveside end of the axle. An extra washer would expand the selection of 120mm hubs that this "trick" would work on, while only increasing the axle spacing by a mm or two.
But every bike is different, and spacings and clearances need to be well-considered, tested and re-corrected if necessary.

When I re-dish the wheel to restore centering of the rim, I typically increase and equalize the spoke tensions, so the wheel is still as strong as it was.
Axle re-spacing efforts are time consuming I must admit. I tend to try to optimize the wheel and axle strength by lengthening the driveside axle spacing by the most minimal amount, hence the added consumption of time as I may need to "home in" on exact dimensional adjustments.

On bikes with wide-ranging chainring sizes, such as 52-36t, I am able to ride fast enough using only a 13-24t five-speed freewheel even here in the foothills.
But with more-normal chainring sizes, I need at least six cogs to handle the terrain changes and keep up with today's local pelotons.

Lastly, a typical Shimano 7s, 126mm freehub can be narrowed to about 122mm simply by removing washers from both ends of the axle.
And on many bikes, there will still be enough clearance for the chain at the dropout.
Here's a 124mm-spaced 7s, freewheel-style wheel I put together for use in a 121mm Peugeot frame. This wheel is strong as heck!