Do I need 2.5GB for my iOS 6 update on my iPhone 4?

I have a 16GB iPhone 4 with 0.65GB left on my phone. It wouldn't let me do the update through my phone because I have very little space so I connected it to my computer, opened iTunes and chose to 'Download and Install' the update. It has started to download but I haven't got to the installation part yet. At this point will I have to free up 2.5GB of space on my iPhone through deleting videos, apps etc? If i do have to free up this space, after the installation will the overall space taken up actually reduce to about 450MB (as i have heard from others). Any help would be deeply appreciated, thanks!

Just restore in itunes, that will update to ios 6, then restore off your last back up and that will put everything back on your iphone.

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