Upgrading from ESX 4.0

Thanks in advance for any advice.  I’m the IT Manager at a school district and I am preparing to upgrade to Vmware 5.1.  I currently have three ESX 4.0 servers and one Vcenter 32bit server on a physical box.  Since I have to migrate to a 64bit platform for Vcenter, and from ESX to ESXI, I was thinking a clean install would be the best approach but I’m not sure which would be the most efficient way.  Initially I thought of doing something like this:

1. Create a VM for the new Vcenter server on one of the 4.0 hosts.
2. Install Vcenter 5.0 and migrate settings from the 4.0 Vcenter (Is this neccesary or should I just start with a fresh Vcenter VM?)
3. Remove the three hosts from the 4.0 cluster and add them to a new cluster on Vcenter 5
4. Upgrade or clean install each host to 5.0 (I can vmotion all of my VM’s to the other two boxes and still keep everything up)
5. Upgrade everything to 5.1

I’m open to any suggestions.  Also, how does the upgrade affect the data stores? Do the Volumes need to be updated to VMFS 5.

Thanks again for any help.