I finally took the plunge and upgrade my OS from 7.1.205 to 7.1.342.
I use the AppLoader method and here is what I have to report :
1. No need to backup data and 3rd party apps, the AppLoader method has option to back it up and restore in 1 swoop
2. No need to use BBSAK to backup 3rd party apps , see above
3. My BES activation transfer also, no need to reactivate
4. All my service books from ATT also restored properly
5. When I first boot up, I have 140 MB free memory, previously I only have 120 Mb free with .205
I will report any memory leak here , so far it's been pretty smooth and fast .