Not sure about your space question. I thought there was a document floating around out there that documented that. In regards to your backup scheduled - SolarWinds Knowledge Base :: How to Configure Backups on Your LEM Appliance
If you're just upgrading, a one-time archive before you upgrade is fine.
Space-wise, if you look at the "database" output in the diskusage that appears when you log in, it's literally going to make a copy of that data, so you will probably need close to 1:1 space. (And it'll take a while! Sometimes it's faster to make a copy/snapshot of the VM than the archive!)