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Help Upgrading problem

Hi,

I have 2.2.1 on my N1 and I'm trying to upgrade to Gingerbread.

I've downloaded, renamed and place the update.zip file on my sd root.

Once I try to install it I get the verification error message.

I have a Spanish Vodafone N1. I've read from Rusty that I should:

"You have a Vodafone Nexus One, if you want Gingerbread you have to root, install a custom recovery and flash through that."

Where can I find a step by step guide for that?
Rooting will erase all my contents, apps, photos, etc?
Any other risks?
Will I then get OTA updates or will I have to carry out future ones manually?
Is it worth it or should I just wait to get it from Vodafone?

Thanks!
 
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