Rehabbing a staircase in place

As part of our basement project, Im going to change from carpeted to wood stairs. The way the staircase is built pretty much eliminates any chance at easily removing the existing treads and replacing them completely. The bright side is that the existing treads are painted pine 2x, so they are fairly tough. I figured I would use Retrotread to cover over them directly, or even actual stair tread material instead. As part of a different project, I had to remove the landing at the bottom of these steps, so now I have a chance to do something: the current rise of each step (except for the top step) is about 7-3/4"....basically the max height by code. Should I add a 1/4" (or thicker) "underlayment" on each tread so I can reduce the rise of each step? Once thats added I would adhere the Retrotread/regular tread to that underlayment. Since the landing is brand new, I have the ability to add enough material on top of the frame to keep the last step at the same as the others. If its worth the effort, what kind of product would I use as an underlayment? Just 1/4" (or whatever thickness) plywood? Cheap hardwood (i.e. poplar)?