TL;DR; - It preserves data on Isolated Storage when updating from WP8.0 to WP8.1 Runtime.
Because the provided link to MSDN says only about Silverlight apps, and it's not clear (if I hadn't missed something) what would happen in case: I've old WP8.0 Silverlight App and now I decided to upgrade it to WP8.1 Runtime - I've performed a simple test:
- I've published a Beta version of the App - WP8.0 Silverlight.
- After successful instalation on the Phone, I've copied some files inside the App, so that there is something on Isolated Storage
- I've submitted an update - went to Store, selected Beta version (WP8.0), clicked Update then Upload and describe your packages, after a while, Add new (not replace the old WP8.0 package), add some information, save and submit.
- After some time my Phone is notified that there is an update for the App - I click yeah - update
- After successfull instalation, I see that it's a new App, I click my special button to see what is on Isolated Storage and I see that there are old files from WP8.0 version
So it turns out that LPains answer is correct (+1).