You can upgrade from RHEL 4 installer itself. But don't use RHEL automated installer. It sucks like hell. I have very bad experience with Anaconda.
I have updated several times using following method
Backup all data
- Backup all configuration files from /etc and software specific such as postfix and Apache
- Backup user database (/etc/passwd and shadow group files http://www.cyberciti.biz/faq/howto-m...to-new-server/)
- Backup user emails
- Backup user /home dir
Once everything is backed up - do as follows -- Format existing drive
- Install a clean system using RHEL 4 CD or network installation
- Run up2date via RHN
- Install needed application software such as apache, postfix etc
- Configure security
- Restore user database
- Restore software specific configuration data and config file
- Restore user emails
- Restore user /home data
- Reboot and test
- Finally run up2date to patch it again
See Move or migrate user accounts from old Linux server to a new Linux server =>
http://www.cyberciti.biz/faq/howto-m...to-new-server/
Hope this method solves your problem.
Good luck!