Sapphire 1.1.1 is an old build of android, yes, and has been updated and is going to be continually updated for the foreseeable future with cvpcs now not as busy with school. If you would like to work on updating your rom, I suggest you buy the pro version of TB, if you haven't already. This will help with restoring your apps plenty faster.
Now, to work on getting everything backed up, there are a few apps recommended for this. Titanium Backup (which you said you had) is a wonderful app by itself, but the PRO version makes restoring apps considerably faster as you don't have to manually select each app one by one and hit restore. Just do NOT choose to backup system apps. Just backup user apps. Another app, if text messages matter to you, is sms backup and restore. This app will backup all your sms and mms messages and allow you to restore them once done installing your new rom. Finally, if you are using a custom launcher like ADW, ADW EX, or LP/P, then use the built in backup feature so you don't home screens (it won't backup widgets, so make a note). If you aren't using a custom home replacement, I highly recommend it as they are usually more stable and better about not having redraws, plus more features doesn't hurt.
Next, you will need to download the files needed to upgrade your phone to the latest build of sapphire. Those files include the rom, google applications package, kernel, and even a theme if you have one on your mind. You can download all these files (minus most themes) off the official release page here:
sapphire:releases:2.0.0 [CCRoms Wiki]
Make sure you grab both the rom and google apps package at the LEAST. Download this files to your computer and manually move them over to your phone and place them on the root (i.e. not in any folder) of your sd card.
Next make sure you have backed up anything you need and/or want. This will include apps, text messages, home replacement apps, and anything else. After doing so, reboot into recovery either by long pressing the power button and selecting reboot then recovery, powering off the phone and powering on while holding x, or hitting the reboot recovery option in rom manager.
Once in recovery, before you do anything else, make a backup. If you are not using Clockwork Mod, I suggest downloading ROM Manager off the market and selecting Flash ClockworkMod Recovery. It is best to select this option 2 or 3 times as it doesn't always flash the recovery correctly. Next, to make a backup, scroll down to nandroid using the volume rocker controls and select backup using the camera button.
After the backup is finished, press the power button until back to the main menu (if it doesn't already put you there). Scroll down to and select wipe data/factory reset. Next, scroll down to and select the partitions menu and format boot and system. This will completely wipe your phone.
Now we flash the rom. Press the power button till you are back to the main menu. select install zip from sd card and choose zip from sdcard. Scroll down to and select the sapphire-2.0.0-update.zip file and select yes. After it installs, select the gapps package too. Now, you can flash a kernel if you want (the stock is capped at 800MHz), but do not flash a theme until you have rebooted and let your phone sync. Press the power button, select reboot system now.
The phone will take a few minutes to fully start up and reach the setup manager. Just wait until it does. But, once it does, sign in and let the phone sync everything back to normal. If you are near wifi, enable it. it will speed up the process. Once your apps have restored, you can use the apps like Titanium backup or sms backup and restore to help you set up your phone close to what you want it too. Just remember, only restore user apps and data.
Also, to help minimize the home screen redraws when hitting the home button, go into the GEM Settings, select Tools and then Dev Tools. Then scroll down and select terminal emulator. Inside, type:
su
echo ro.HOME_APP_ADJ=1 >> /data/local.prop
Press enter after su and again after the next line. This should help greatly minimize your homescreen redraws.
If you want to automatically hear about updates, open the settings, scroll down to GEM Settings and select GEM Notifications. Inside it will allow you to hear about patches and new roms.
This should cover about everything to help you set up the new Sapphire on your phone. If I missed anything someone feel free to correct me
Sapphire will also receive a pretty significant update soon, but you should be able to just flash it right over your current setup without any problems.
Hope this helps anyone else who wants to install sapphire or update their phone too!