I've posted a quick pre-release of the upcoming version of Portable FileZilla. It adds in the an automatic backup-restore to ease upgrades. It also allows you to unzip Portable FileZilla directly over an existing installation. Please give it a try... specifically, testing that filezilla.xml is created from one of the backups in the settings directory if it doesn't exist... and that it is created from filezilla.xml.default if no backups exist.
Any comments or questions can be dropped right in this thread.