Hi there, harebearva!
You do not have to upgrade from Dingo (Android 1.6) in order to download books from your library. The upgrade is useful, and safe for most people who've done it, but it is not necessary. I would suggest you wait until you are comfortable with the (small) risk before you attempt it.
Meanwhile, if you have any questions about getting books from your library, please ask! I download to my computer first but will try to help with direct downloading too if you're stuck.