The type of seed electrum uses was changed in the 2.x versions. You can download an old 1.8.1 version of the wallet here and import your seed into it. I think the latest version of electrum could then use the wallet file the 1.8.1 version generates. If not you can always export the private keys from the 1.8.1 version and import them into the latest electrum.
https://download.electrum.org/1.8.1/This thread discusses fixes for your problem.
https://www.reddit.com/r/Bitcoin/comments/30x79y/i_cant_restore_my_electrum_wallet_using_my_seed/ThomasV says version 2.0 converts wallet files from older versions into a different format.
https://bitcointalk.org/?topic=942961.0version 2.0 will convert your wallet file to a new format, which cannot be read by 1.9.8. anymore.
I suggest making a new seed in the latest electrum version and sending all your coins to that wallet after you get back control of your coins from your old wallet.
It's best not to try sending coins directly from a 1.8.1 version wallet because the network might not accept them since its (s values) rules changed. Import your wallet or keys into the latest electrum before sending coins through the network.