Yes it fits and it is an upgrade, depending on what you are going to do...
The FS-fork won't do well in the woods but if you are converting the bike for tarmac it definitely will be an improvement. First issue is that the newer fork uses a larger front axle than your bike is equipped with, so you have to either get a newer wheel or some kind of kit so you can use your old axle (and wheel) with the new forks. Second issue is the brake caliper. FS forks from 2005 or newer uses a radial brake caliper and therefore your brakes are not a straight fit.
regards
/Nick