You won't need to reload your database if you follow the upgrade instructions and everything goes fine. And 99.9% of the time, everything does go fine, and you don't need to tinker with your database at all. The backup procedure is just a precaution for the 0.1% when things do go wrong.
As Kaf said, you should delete all of the files that relate to WP from your server. New versions are included in the 1.5 package that you download from this site. This is because things have changed a lot from 1.2.2 to 1.5 and there's no guarantee that the files you had with 1.2.2 will even work with 1.5.
@import line is just one way of calling a stylesheet. Wherever you've been calling your stylesheet, whether it's a
<link> element or a
@import inside a
<style> block, change the URL from whatever it is to
<?php bloginfo('stylesheet_url'); ?>.
The rest of the renaming procedures that podz describes are just to accomodate 1.5's new theme system. Follow them if you'd like to quickly have your old layout ported to 1.5. Otherwise, you'll have to do some tinkering to find out what needs to be changed. I also suggest that you read the Codex link that was posted earlier in this thread.