1. Backup bb
2. Wipe bb make sure SIM card is not in BB
3. Once BB is booted without any SIM card
4. Connect to PC
5. Run loader.exe (don�t forget to delete vendor.xml file)
6. Update.
in normal scenario wipe is not.
But OP has a non BIS/BES enabled bb, and some of the service book is present there which may halt to achieve updating to newer OS.
Once wipe is done without SIM CARD, BB will not take any carrier settings by default and upgrade can be done easily.
From the instructions you've already been given...
4. You will see a box to enter the password. If you don't have a password, leave it blank and press OK. If you have a password, key in the password and press OK.