You don't need to delete internal storage. So your videos, pictures, documents, etc will remain untouched. However all your apps will be gone. Suggest you do an apk backup of all your apps and save those apks in a different folder in your internal storage or sd card.
You need to wipe everything except internal storage and sdcard.
Then you need to install the zip file of this ROM and reboot after installation is complete
Done.
If I don't install this incremental package, will I be able to get the next new updates and install them by simply restarting the device?
Also, is there any way to install this incremental package like all the other updates ?