It really depends on if you want a backup of the machine as it was - with whatever scripts you’d already installed, etc.
SD cards are cheap so easy to do a new install on a fresh one. If you don’t have a spare, it’s not really a big deal either way.
Before reformatting to a fresh image, I’d suggest trying the update procedure once more.
SSH or FTP to Fates and delete the `/home/we/version.txt` file
do RESET from the norns menu or `sudo reboot`
run UPDATE from the norns menu
start up again and you should have the most recent version of norns.