Will in-place upgrades be allowed on the final release?
It's not a case of allowing it, but the LibreELEC upgrade procedure is not designed to keep a previous version in the background or wherever. The same goes for the data in /storage. Before you upgrade, keep a proper backup available (just in case).
A massive database... using the local SQLite database only: make backups first. Using a MySQL/MariaDB server: use mysqldump for backups or some other SQL tool. Also, Kodi upgrading a database will also leave the old database in place.
An alternative for backups: Kodi's video library export function. It will create .nfo files (and fanart if selected), which will make for a much faster rescraping (going 10-15 videos per second on a proper network) since internet access for metadata is not required.