Upgrade to 1.5: Is this possible (recommended?)

I’m running WP 1.2 with many things customized/added with template and PHP and htaccess permalink modified rewrites etc and don’t want to go through another marathon of upgrading to 1.5 yet (not broken, not fixing it)

But I want to! (is there, so must)

So here’s my stupid question:

Can I install WP 1.5 in a new dir (say, /wp2) with a new database, set it up from scratch, at a leisurly pace (building up gradually to the look and feel of current blog) and when everything is fine, simply change the database info in the new wp-config file to point to the old database? Then I’d simply change the current /wp dir occurances to the new /wp2 on my .htaccess and hope to achieve a ‘seamless’ transition?

Can it be? :\ I understand it may sound very stupid! But am a newbie, so please go easy.