I've upgraded from 1.05 to 1.06 with no problems.
And it's not that you should backup your entire disk before doing an upgrade - it's that you should always backup your entire disk - because if you don't and something glitches, you have no protection against data loss.
Firmware flashes can fail - so can hard drives, memory, power supplies, etc., etc. - sometimes sh** happens - two days ago, mid morning, half the contents of my email inbox were somehow screwed - the contents of the messages bore no relationship to the subject of the message and it was obvious that some sort of indexing was out of whack - I spent 5~10 minutes compacting folders and what have you trying to force it to re-index and then gave up, and restored it from the backup.
This is the second hiccup I've had with my email in about eight years - and it's different to the previous one - where I also ended up restoring.
The mail store is on a RAID1 pair, so whatever glitch occurred wrote to both my disks simultaneously, which is what RAID1 does, and without that backup I'd have been in major grief.
What does this have to do with the DNS-323 - nothing really - in fact it doesn't even enter the picture other than that's where my backup is stored - so to cut a long story short - mirror all you want, but if you don't back it up, then don't get upset when sh** happens and you find out that the mirroring is not a backup - it's not intended to be.