updating just requires running the installer against the previous install location - there's generally never been a need to uninstall before installing the new version.
you can also use
http://forums.winamp.com/showthread.php?t=317153 to create a backup of the Winamp settings including all of the library data, etc.
also, the last few versions of Winamp can directly save the rating into the files themselves (if supported for the file format) by going to preferences -> media library -> library options tab -> check 'Save ratings to file for compatible formats' and then you'd need to re-rate all of the files to force Winamp to save the rating into the files.
-daz