Does running Phone Repair from Xperia PC Companion delete any data? Basically the title is my question. Also What precautions should I take before running Phone repair?
Data in the phone will be deleted, only data in the SD card will remain. Make sure you have done all proper backups of data contained in your internal memory.

Other than that, i'll make sure to have a backup of my contacts or make sure they are synced to an online service.