All software will be backed up and reinstalled. However, if anything goes wrong and you have to start the installation over again after the OS has been wiped off the device you won't get your 3rd party apps back (you'll still have your data backup, though.) I recommend following this procedure to backup your 3rd party apps. That way it's easy to reload them all again if anything goes wrong.
http://www.blackberryforums.com/rim-...arty-apps.html
You will lose the sync with your BES. If you have an online connection to your email server and Desktop Manager picks it up then activation will start automatically after the upgrade process (give it a couple minutes after all is complete and it should start.)
if you don't have a connection then you'll need to get an activation password from your IT dept.