I've been trying to follow the thread, and I'm not sure the upgrade process to Mountain Lion, which is through the Mac App Store only, has been clearly communicated in all the discussion of partitioning, TM backup & cloning of Lion and Mountain Lion. There's a definitive progression in the upgrade procedure...
I transitioned from 10.7.4 Lion to Mountain Lion 10.8.0, and it is an upgrade process set in motion by purchasing 10.8 on the Mac App Store.
At present, one can not download a disk image file of Mountain Lion, which would allow a subsequent install - say, like downloading a 10.7.4 Combo Client disk image file for later install. So presently, I believe the only way to get Mountain Lion is to through the Mac App Store process, which initiates an installation procedure.
(Plantsower, I assume no charge will be made to your CC as long as you upgrade before 8/24 - but, I don't know how Apple handles that part.)
Once one clicks to purchase of Mountain Lion from the Mac App Store, the upgrade process begins in a continuing process typical of how the Mac App Store installs new - or updates - software.
When this upgrade process is completed, via a restart, the previous OS is no longer on the internal drive since the internal drive is now running Mountain Lion OS 10.8. (As this procedure basically works like an "update," all user files, folder structures, system preferences, & settings are maintained as they were with the prior OS set-up.)
In my situation, I had completed 1 external-drive TM backup and 1 external-drive clone before beginning the upgrade procedure. ...Then, either my TM backup or the clone could have been used for a restore of OS 10.7.4 on the internal drive.
[ IMHO, regarding Mountain Lion, it is the next progression in the Mac OS, regardless of whether one uses iCloud. If one's using 10.7.+ Lion, it certainly makes sense for Macs around 2 years old or newer, to upgrade (for $20, why not ?). There are, however, some niggling issues with 10.8.0 - not real big ones, at least for me - that cause me to generally advise waiting for 10.8.+ and then, install Mountain Lion. My upgrade installation went very smoothy, nonetheless, and 10.8.0 is working very well on my MBP Mid-2010.]
I hope I've provided some helpful clarification about the Mac App Store procedure in this post.
