Before I sync and update my iphone, it says I need to sync and if I do that all the apps, data etc will be replaced with files from itunes library.!! There arent any files on itunes. I cant afford to loose any information on my iphone. Am I reading this right?
Have you ever synced your phone with this particular computer?
ETA: iTunes should do a full backup of your phone prior to the sync. If you are just now updating the software you will be at it a while. If you want to wait until tomorrow evening pm me and I'll give you my phone number and walk you through it.