Android: Managing Ad-Free and Ad supported version. Move to in-app purchase?

Android: Managing Ad-Free and Ad supported version. Move to in-app purchase?

I currently have an Android app which is distributed as two applications
an Ad supported version and an ad-free version. The Ad-Supported version
has over 10,000 users and the Ad-Free version has a couple of hundred.
Currently both projects are completely independent making updates a fairly
tedious task. Ideally I would like to just updated one project and build
be able to build both versions. After looking online it seems I have two
options:
Make a library containing most of the class files and then just extend
this for the two versions (changing only the files that are different). As
the project is fairly big this may be a large task and may cause some
serious headaches.
Just release one version and use in-app purchases to remove the ads. This
seems the easiest route but how do I allow my existing ad-free users to
remove the ads via in-app purchase without paying?
Hopefully someone has been in a similar predicament before and can point
me in the right direction.