shouldn't need to redo everything. I've only had two errors with my system. one was from a botched update that I used debian to fix; the other was when everything got corrupted. it took a while to fix everything but that's about as close to starting over I've ever gotten. just follow the update tutorials on here and FSD. it's not overly difficult, but you do want to pay attention. I have three update tutorials, but you should probably use @DinohScehe 's (if he has them), since they come with pictures.
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you can update through xell btw (don't have a tutorial on it). debian may require xell to work, but I can't recall. I have the disc on my computer if you ever need it.
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also, btw, you can usually get into xell by pushing the eject button to power on the system. iirc, xell requires av cables though, so when you flash your system, make sure to flash xellous or xell reloaded. I think both can use hdmi (if you're system has hdmi).