When I am ready to install, it says...
Ready to Install? (This will wipe any existing data. You are NOT in Upgrade mode!!!)
I've no idea how to get in Upgrade mode
Reposting
Yes - - the new database is empty and you install the new version and it creates the proper configures for the location you are installing to

Being empty there is no data to lose

After this has been a success you use something like phpmyadmin to import a db backup from your live shop into this new database and re-run zc_install - - upgrade the db only at this point