A "backup critical console data" does not help you after an update/upgrade, unless you need to step back to the previous version.
What is a BCCD: backup of all modified files since last install. when you need to reinstall an HMC (eg disk crash), as a last step you patch it with a BCCD dvdram to get to an exact copy of your HMC like it was when the BCCD was made. You should make a BCCD periodically or at least whenever a major change occurs.
For an update/upgrade, you also make a BCCD, just in case the update/upgrade fails so you can get to a working versions with all your configuration changes from reinstalling your previous versions with the recovery CDs or DVD. Thus a BCCD is "mated" to its HMC version! So you should mark it that way on the BCCD DVDRAM: HMC name, version, date, annotation...
When you upgrade (e.g. from V4 to V5), the local config changes should be saved to a protected partition on the HMC internal disk, so that the changes can be applied after you load the newer version - this newer version is applied by reinstalling the HMC!) I don't know all the details by heart, but I remember it all being fully documented on the infocenter website.
HTH,
p5wizard