My rule of thumb is this...
Backup everything prior to the upgrade... Then when you FTP the new files only overwrite files (NOT folders) this way you can ensure you're not overwriting something in a folder that is part of a modification you've added... When adding images check vb.com to see which images have changed and which are new. If you are using a custom style only add the new images....
Lastly, compare the new template with the modified templates and make any changes needed. With the new plugins and products you should really one have 3-10 templates to change/update. If you have more than that I would bet there are little to no changes if you check the updated modifications...
This is my method and it works well for me...