Is data retained if copied from RAM to flash memory using IAP?

Yes, the whole point of Flash is that it is non-volatile; ie, its content is preserved when there's no power.

Yes, the whole point of Flash is that it is non-volatile; ie, its content is preserved when there's no power.

Things to consider:

Flash needs to be erased before writing/updating.
The size and placement of flash blocks/sectors within you devices memory map.
The minimum erase size, strategies to reduce wear (erase cycles).
The erase and write speed with respect to w atchd ogs or real time behaviour.
Shrinking your IROM size to accommodate a writable area outside the space the linker is using.

Thanks guys for answering, Now I know this is the right choice, however I have some coding problems now. I run into a hard fault when try to simulate the following code in keil-uv4.7 simulator. IAP does not run.

#include <LPC17xx.h>
#include "ClockConfig.h"

#define         true                                            1
#define         false                                           0

#define         IAP_LOCATION            0x1FFF1FF1
unsigned int command[5];
unsigned int output[5];
typedef void (*IAP)(unsigned int [],unsigned int[]);
#define iap_entry ((IAP) IAP_LOCATION)

unsigned char x = 40;


void IAP_WriteAndRead(unsigned char *variable);
void Disconnect_PLL(void);

int main()
{
        SetCPUClock();
        IAP_WriteAndRead(&x);
        while(true);
}

void Disconnect_PLL()
{
        LPC_SC->PLL0CON = 0x01;
        LPC_SC->PLL0FEED = 0xAA;
        LPC_SC->PLL0FEED = 0x55;
        LPC_SC->PLL0CON = 0;
        LPC_SC->PLL0FEED = 0xAA;
        LPC_SC->PLL0FEED = 0x55;
}

void IAP_WriteAndRead(unsigned char *variable)
{
        Disconnect_PLL();
        command[0] = 50;
        command[1] = 0;                                 // strat sector 0
        command[2] = 0;                                 // only sextor 0 is being written
        iap_entry(command, output);
        if (output[0]!=0)
                SetCPUClock();
        else
        {
                command[0] = 51;
                command[1] = 0x100;
                command[2] = (unsigned int)x;
                command[3] = 512;
                command[4] = 12000;
                iap_entry(command, output);
        }
        SetCPUClock();
}

Keils simulator simulates a lot of hardware.

But that doesn't mean it simulates flash memory - and that it contains a copy of NXP:s proprietary boot loader.