Well, I just realized that I may be throwing some terms around that may not make much sense or I am using them in ways for which they were not intended. Perhaps a little terminology will help.
Refashion: this term usually refers to clothes that are taken apart and sewed back together into a new piece of clothing. The look of the item has completely changed or has been updated. A good example, is my skirt made out of a bridesmaid's dress.
Remake: this term means taking something that was made for one purpose and reusing it for another. This term can be interchanged with upcycling although it is used more for clothing. This could mean taking a men's t-shirt and turning it into a pair of underwear.
Restyle: this term means taking an item that was created in one style, and giving it a new one. This could man taking a men's t-shirt and turning it into a girly top or giving a skirt a lace hem. As I understand it, this isn't as drastic as upcycling or refashioning.
Upcycle: this term means taking something that was meant for one purpose and reusing it to give it a new life. This term usually refers to an upgrade or better function that the original item had. This could mean taking a pair of pants and turning them into a skirt, or a shower curtain and turning it into an ottoman cover (part 1 and part 2).
Of course, to make things more confusing, some of these terms are interchangeable.