I was advised to install LMS 2.5 on a separate server from the current live LMS 2.2 version I have running. Is it an upgrade where I have to install the older version first or can I do a clean install with the new 2.5 CD's?
You can do a clean installation of 2.5 on the new system. If you have an upgrade license, you will need to validate your LMS 2.5/2.6 installation by pointing to the existing 2.2 server. Validating an upgrade is documented in the installation guide.