Suggest that in the next release there is an exception inserted to the upgrade script. When you run the ./setup the script checks to see if it is upgrading an existing installation and makes backups of the config files and database.
It would have been helpful if the upgrade stopped - or at least prompted - when the backup of the system db fails when upgrading. At present the following message is written to the log file
Mon Jul 31 13:20:05 BST 2006 - [ISPConfig] - /root/install_ispconfig/install.php, Line 745: WARNING: could not dump old db to file existing_db.sql
I say would have been as I am currently crying into my beer over a very kippered server.