I think you can go directly from 4.5.596 GB to 0.8 through the Donate version of the Liberty Toolbox. Download it through the toolbox then install it with Bootstrap
EDIT: Someone please correct me if I'm wrong as I haven't actually done this
Depends on the backup, but either way I'd do a clean install. You have to do a data wipe/factory reset when you install 0.8 to avoid huge and unpredictable issues anyway.