The hotfix which is installed with FMP 11 is a Windows Installer update ( I believe ) Vista & 7 do not require this hot fix, but windows XP usually does. This is required to install Filemaker Pro 11.
Theres nothing special about the hotfix as far as I am aware, it may create a system recovery point but thats about all.
None of your database files should have been touched during a filemaker install, certainly not deleted since the installer will have no reference to the file names, even an un-install would not remove them.
For what its worth, I have installed / re-installed and updated a number clients machines to 11 with no issues.
It sound to me like there is something more going on, rather than the install process, what that is I have no idea..
P.S Im not saying this did not happen, just adding my experiences.
Thanks for your input, I was mainly posting this message for people who don't know this could happen.. And thanks I did not think to use the restore feature that saved me some down time since my backup files are at home.