What does a "Clean Install" mean when upgrading to Mac OS X?
Answer: When you install Mac OS X, you are given the option to do either a "Clean Install" or "Upgrade and Install." These choices are available whether you are upgrading from Mac OS 9 or from an earlier version of Mac OS X. If you choose to do a clean install, the installer will completely overwrite the old system files, including your home folder and personal files. It is essentially the same as erasing your hard drive and starting from scratch. Therefore, if you have important files on your computer that are not backed up, do not perform a clean install or you will lose all your data!
Instead, choose the upgrade and install option, which will overwrite the necessary files to upgrade the operating system, but leave your personal files intact. This option is most likely what you'll want to choose when installing Mac OS X. If you're upgrading from Mac OS 9, your OS 9 documents will be left untouched and your old system folder will be used for running the "Classic Environment" within OS X. If you're upgrading from an earlier version of Mac OS X, your home folder and other user folders will remain intact, but the operating system files will be updated.
The only reason you may want to perform a clean install is if you are having constant errors and other problems with the operating system. A clean install allows you wipe the hard drive, eliminating any bad or corrupt files from your system. You must back up your data before choosing this option. Alternatively, you may choose the "Archive and Install" option, which performs a clean install of the operating system, but preserves your user folder and personal files. I would still recommend backing up your data before choosing this option.