Start with this document and come back if you have further questions.
Edit - you'll also need to check the release notes to ensure that you choose an IOS that supports the linecards.
I've seen this article already, and the thing that confuses me about it, is that my 6500 doesn't have an IOS .bin file, just the CatOS.
Should I just TFTP up an IOS file, and delete the CatOS file?
I've upgraded both c6000 MSFC1s and c6500 Sup720s. I assume that the MSFC2 is very similar. You will want to tftp a copy of the IOS.bin to the supervisor as well as leaving the CatOS.bin on there. During the upgrade process you will boot the IOS.bin and then format the flash while running IOS. Then you will need to copy the IOS.bin and startup config back to the flash.
I have a copy of the console log from the MSFC1 upgrade online here:
I can post the Sup720 console log as well if you would like.
I'm a bit confused about the config (running-config) conversion from catos to IOS. How does that work. Do we have to manually convert the CATOS configurations to IOS or does the IOS automatically does that for us.
Cisco has the EDI tool which you can use to automatically convert the CatOS config to IOS. It mostly works, but you absolutely need to manually compare the EDI generated IOS config to the CatOS config. I have always had to make a number of manual changes afterwards. The EDI tool probably does 90% of the work, leaving you with the more complex parts to change over and verify.