Hi there, and welcome to the forum!
Firstly, yes your device will have less memory after update as OS6 is bigger than OS5. For example, the Bold 9780 has 512mb of built in memory compared to the 9700 which has 256mb. The 9780 ships with OS6 already installed, so will run it much better as it has the memory and processor to handle it.
When OS6 was released for the 9700, it was stripped very slightly so the processor and memory can handle it. So having less memory is not an odd thing, everybody with a 9700 with OS6, will have reduced memory! Including me!
As for the icons resetting, I've never encountered that so I don't know, sorry!
This is the version of OS6 that I'm running! Try this:
https://www.blackberry.com/Downloads/contactFormPreload.do?code=02A32AD2669E6FE298E607FE7CC0E1A0&dl=... 2. Do a FULL backup of your device first, using Desktop Manager > Backup. Close Desktop Manager upon completion and unplug BlackBerry.
3. Save the OS file to the PC then install it to the PC by running (double clicking) the file you downloaded.
4. Go to c:\program files\common files\research in motion\apploader and delete the file named "vendor.xml."
5. use BBSAK from BBSAK.org and wipe the device (after doing a complete backup)
then after you get the error 507 (no OS installed)
6. remove internet connection to PC and reboot PC.
7. Plug in BlackBerry and double click on "Loader.exe." It's located in the same place as the above vendor.xml file was in.
8. Plug back into BB DTM and restore from back up!
Enjoy the new OS.
Follow ALL intructions EXACTLY!!