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Why does my Windows Phone 8.1 Lumia 925 Bluetooth no longer connects to either of our vehicles?

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Windows Central Question

Windows Phone 8.1 Lumia 925 No Longer Bluetooth Connects to Either of Our Vehicles

Lumia 925, Windows 8.1, has been working for a year or so, BT connecting to either of our cars without problem. As of yesterday, it would pair, but not connect. That's what the phone display said: Paired, but the car would say it was trying to connect. After a while the phone would say: Couldn't Connect, and very often, the listing for that car would disappear altogether.

After thrashing around, one car got connected and phone registered.

The second phone will sometimes prompt me for the passcode, which I enter, but then the connection is never made.

Since this has involved both vehicles, on the same day, I'm saying there is something amiss with the phone. I have, of course, recycled power many times. I have not, though, done a factory reset. AAMOF, I have never done one of those - will I have to reinstall all my apps and settings after the reset? I do have backup on - does that mean an image of the phone is being maintained somewhere where I can restore completely after the reset?