You can install Lion, but I recommend making sure you have a backup of your present system (Time Machine backup or clone).
You are correct - iCloud requires Lion; Lion requires Snow Leopard as a prerequsite to buying it.
If you don't clone your current system to another volume Snow Leopard will be lost.
Make sure your system can handle Lion:
OS X Lion system requirements
To use Lion, make sure your computer has the following:
- An Intel Core 2 Duo, Core i3, Core i5, Core i7, or Xeon processor
- Mac OS X v10.6.6 or later to install via the Mac App Store (v10.6.8 recommended); you can install without Mac OS X v10.6 by using an OS X Lion USB Thumb Drive, available on the Apple Online Store
- 7 GB of available disk space
- 2 GB of RAM
Note: many users consider 2 GB inadequate. 4 GB is a more realistic minimum.