1. Yes, but only for a moment. It takes me about 10 seconds to update.
Be advised that all plugins should be disabled during the upgrade process.
2. Yes, you can skip updates. All updates have the previous fixes/adds.
3. I don't update every single time. Only if there are major security fixes.
However, I did update to the new 2.5 because I heard so many great things about it.
I'm glad I did. I really like the new admin interface. The only thing I don't like about it
is that they took away the drag&drop feature on the widgets page. 
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