You'll want to do a migration install of 5.3... this will be the default method after you boot off of the 5.3 aix install cd1, and you wont 'lose' any data (preservavtion install will clobber a few LVs, overwrite method is what is says :-)
Always take a mksysb before upgrades (only contains rootvg).
Always take a full data backup as well (non rootvg data) perhaps using savevg, tar, cpio, tsm, backup, etc.
You can get specific data off of a mksysb if you really had to:
$ tctl fsf 3
$ restore -xvf /dev/rmt0.1 ./your/file/name