Planning for upgrade

I've been running 1.5 for a while and know I will need to upgrade before long.  I'm envisioning a process something like this:

1. Clone my existing server config, database, code, data files, etc.

2. Upgrade the cloned system.

3. Troubleshoot plugin problems, etc.

4. Once the system is stable:

a. Refresh the database and data files

b. Repoint my domain to the cloned/upgraded system


Two questions:

A. Is this a logical approach?

B. I'm worried about step 4a.  Will I encounter problems with changes in database structure, etc.  Is this as simple as it sounds? (DB backup and restore, copy data files)