If you've ever had me as an instructor for a DotNetNuke class, or heard me present at a user group or conference you've likely heard me say that I always use the DotNetNuke Install package when performing upgrades on my DNN sites. I rarely use the Upgrade package, the main reason for this WAS that the upgrade package came without a web.config file being defined. The ease of the upgrade package was that you could just extract it directly over your existing site and things would upgrade, the problem with this is that if there were web.config changes for the newer version they would be missed, and potentially cause problems with the site down the road.
I was excited to learn that is no longer an issue! Starting with DNN 4.6.2, DNN will now handle upgrades in a much more graceful manner. Michael Washington made a blog post a few weeks ago discussing this, and then Charles made another blog post detailing the XML Merge functionality that gives DNN the ability to do this.
XML Merge also provides module developers the ability to define web.config change that DNN will implement when installing modules, so you can now put custom information into a web.config file without having to tell those who purchase your modules to do this manually.
If you're in need of upgrading your DNN website, be sure to give this a shot, it might save you some time and headache if you already have custom information in your web.config file. As with all changes to your DNN site I recommend doing a backup of the database and filesystem before you upgrade DNN, install modules, upgrade modules, or even delete modules, just to be safe.