In theory, just formatting your bt2 partition and installing bt3 afterwards would be fine. BUT, personally, I would make a backup of your master boot record, I've had too many bad experiences overwriting my MBR.
command for backup MBR:
dd if=/dev/hda of=<BACKUP FILE> bs=512 count=1
and if you need to restore:
dd if=<BACKUP FILE> of=/dev/hda bs=512 count=1
Then you will want to update you boot loader.
Sorry I wasn't more specific but you havn't given me enough details. (e.g. your partition table, which boot loader you use)