Am puzzled by this.
My process was
1. DL update file. Was going to wait to install, but got impatient.
2. Started installer. Backup was taking ages and I thought it had stalled, but left it while watching footie.
3. At half time the installation was just completing.
4. Rebooted phone in factory state (thought it had failed and was reverting but then saw the new "bubbly" wallpaper).
5. After a pause it began restoring the apps (this pause may be the point where people panic a bit)
Second half started. During a pause in play checked and
6. Then music/ vids were being restored
All settings restored by just after full time.
Was warned at the outset it could take an hour and it took not far shy of 2 hours, which I am well used to with apple - the last minute of my first Leopard install too and hour and a half.