I did get the Upgrade process going and my 3.2 MT database was 'upgraded' correctly; but I don't seem to have the default 4.1 templates (as I did when I ran a brandnew install of 4.1, into an empty database). I figure MT used the mt_config table in the DB to 'know' that an update was needed, that is fine, but is it the case that I need to manually change/add my 3.2 Templates? Sorry if this sounds a bit thick, but I didn't see this as part of the 'upgrade' instructions. I used just my 'old' database throughout that process. thanks, (btw I wanted to put my blog file ABOVE the mt file install; as a result, it seems I need to specify the root and archive as full paths, that is okay, but when I create an entry the URL doesn't match the actual path where the .html Entry file is (correctly) placed.

I think what you are looking for is the documentation on "Template Sets."
When you are looking at your list of templates, click the "Refresh templates" in the sidebar. Then you can reset to the factory default, or change your set to "Classic Blog" - it will result in the same thing.