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I have booked two rooms.
First room has three people and the 
second room has two people. The 2nd person in room two can no longer attend. Can I just move the third person from room one to room two? Then downgrade my room too a two person room? What are my best options? Before I call and screw myself over!

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The option may require some price changes. An important note is unless you have permission to handle both reservations, the lead on the second room will have to call and make changes.  It also depends on where you are in time in regard to the booking. If final payment has been made, your options are limited.........the same way if you did nonrefundable deposits. You could swap names for the two rooms, leaving the no-show in your room. They would get taxes and fees back if you are past final payment. Or you can call and move to a 2 person and have to pay the new prices. The person on the second reservation would have to swap out names.

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Agree with @Ampurp85 regarding timeframe and payments, etc.   Typically a three person room cannot become a two person room without price adjustments typically increasing…or perhaps not at all!
You could also just leave everything as is and have that second person be a no show.  Once onboard…the third person in your room can just stay in the other room for the cruise.  Their keycard will still be connected to the original room but you can get an extra key for the second room from guest services.  

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