All you need to do is close WD and all of it’s associated programs (WDFTP, Webcamcapture, clientraw realtime FTP if you used them) and then install the update into the same place that WD is currently located. It will update the files it needs too and leave all your data intact in that folder.
There’s a FAQ about it here: How to update Weather Display for Windows to a new version
I’m using the VP2 with USB datalogger and had the PC lock up a few times.
I sorted it by using a thicker USB cable with a ferrite choke at each end, as Niko suggested.