The installer byteit101 reccomended should put the Driver Station in the Programs section of your START menu. You shouldn't have to copy the old driver station over.
By the way, if you've installed the LabVIEW update after the driver station update, the nicyapi.dll does go missing. Right below the Driver Station update on
http://usfirst.org/frccontrolsystem is
"Fix for Driver Station Missing 'nicyapi.dll' Issue".
As for installing LabVIEW, I don't believe this would be an issue. However, it won't hurt, and it will give you some tools to help you with vision processing. (You can also use LabVIEW to make custom Dashboards)