"It is possible to do a full upgrade and have the latest and greatest though the update manager.
That being said, doing this is not the same as a fresh install.
Personally, my OSs tend to have a 3-6 month lifespan before I reinstall them. As I use them, they tend to generate cruft that gets rather annoying. I have learned how to keep the bits that I care about (like, say, music player statistics) through these reinstallations.
In short, no matter what:
Upgrade != Fresh Install
edit more details: The way Ubuntu does it's updates is every 6 months a new release comes out. If your options allow it (and by default i think they do), the update manager will ask if you want to update to the newer release. Otherwise, almost all of the updates are only security/bug fix.
So every six months, you get new goodness, otherwise you are only getting security updates. For example, Firefox 3.5 still is still not in the official Ubuntu repositories, and won't be until you are running Ubuntu 9.10 (Karmic).
Oh, and by the way, if you havent figured out why Ubuntu's versions are so funny, 9.04 = 2009, 4th month (ie: April) because that is when it came out. so 9.10 will come out in 10/2009, probably near the end."
"Update Manager is providing regular security and stability updates to the various packages installed on your computer. Occasionally it is also providing the possibility to update a whole new version of your distribution (e.g. Ubuntu 8.10 --> Ubuntu 9.04).
In the case of Ubuntu, they are following a 6-month release-cycle, that means a new version in April and in October. These new releases usually contain newer versions of the same packages and improved usability and visual appearance, so a simple package update would not be sufficient.
If you are not using an LTS (long term support) version of Ubuntu, then it is a good practice to upgrade to the latest distribution, maybe immediately after release, but a little bit later, after the initial quirks are smoothed out. Update Manager will tell you when a new release is available.
But if you partitioned your drive in a way that /home is a different partition, then maybe it is a better practice to reinstall from scratch, but you should save your package list and configuration beforehand, and restore them. So update for convenience and reinstall for performance."
