As long as you download v1.01 from the site where you purchased it, and install it into the same location, your games in progress will not be affected.
If you want to take steps to back up your games first, you can follow this procedure:
Using Windows Explorer, go to the directory where Virtual Villagers is installed and look for files named Isola**.ldw (where ** is a number). The single-digit numbers are your "primary" savegame files and are numbered 1-5 (corresponding to the player slots). The two-digit numbers are the "backup" savegame files, and are numbered 21-25. There is also a file Isola0.ldw which contains settings.
Copy those files into a temporary location until you've updated the game and verified that everything is working properly.
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Barbara
Unicorn
Last Day of Work