In order to apply the Barometric Pressure Setting (BPS) Advisory Tool, is a software upgrade required for the radar processing systems or is the information (incorrect altitude settings) send via downlink and processed like any data link information?
I don't know, you'd have to ask NATS.
There's a good write-up on Mode S BPS here:
http://www.skybrary.aero/bookshelf/books/1401.pdf.