if you get the smilies error , that means you trying to run the upgrade from the install page instead of installing.
if you already have a database from the old board, dont install, just upload all new files to a new folder,
then, copy your old config.php file over the new , blank one.
then, in your browser, go to yourphpbb/install/update_to_latest.php
then delete the install and contrib folders,
it is just that simple.
now, if you do not have the old database, then you need to create a new one.
( and of course spelling counts, you can name a database whatever you want, you can name it jeliosbYIPppeheh if you want to , but when you put in the database name in the install page , you better spell it correctly and use the correct case. everything on the net is case sensitive.)
now, once you have created a new database, you just install phpbb like normal.
using the install page and putting in all the database info you just created.
follow the instructions exactly and you will have phpbb installed in about 5 minutes at the most.