Yep, I'd say this is by far the biggest issue. And it's not like this caught anyone by surprise, it's been obvious that the reason Chrome can pull off rapid updates is due to its /unobtrusive/ updater. Firefox, even before the rapid release cycles, already had issues with its updates. Firefox for some reason had completely ignored UAC and non-admin accounts on Windows (I guess presuming everyone would disable UAC and run as an admin?), because for the longest Firefox's updater would crap out in that situation. Even now, it still doesn't work if you try to use it from an instance running as an unelevated Standard User (it fails silently as well, even on 13.0!).
The only way Chrome's updater could be topped is if a browser figured out a way to perform them without restarting at all (with a stable inter-process interface and some cleverness I'm sure it could be pulled off, although it may or may not be worth the effort).