Well I finally got around to upgrading my wordpress installation from 2.0.1 to the latest greatest of 2.0.5. It was incredibly simple and here's a quick 5 step upgrade plan.
Step 1: Backup Database Tables and Files including .htaccess and wp-config.php
I used mysqldump to backup the tables and moved my .htaccess and wp-config.php files to a safe directory.
Step 2: Deactivate Plugins
Go to your WP Admin panel and manually deactivate all your plugins.
Step 3: Overwrite Files
Download and Unzip the latest version of Wordpress. The copy all the new files over to your current wordpress installation.
Step 4: Run the upgrade script
Run the upgrade script that should now be located at your local wordpress install. www.yourserver.com/path/to/wordpress/wp-admin/upgrade.php
Step 5: Reactivate Plugins one by one
Now all you have to do is reactivate your plugins and your upgrade should be complete.