Doing the upgrade locally is an interesting approach. I guess that might make it a bit less complex and risky. My main concern however, is that I have a website with user data which is being updated continuously. So, simply restoring a database I have developed locally is not an option as that will delete the user data.
Currently, I am using only a fraction of Sitefinity 3.7 in just a part of my website. In the coming months, the whole site will be rebuild in Sitefinity 4.0. It will hopefully also include the Sitefinity forum module (assuming that it will be released in Q2).
Now, the forum module is a perfect example: Let's assume someone wants to upgrade SF4 Q1 on shared hosting to SF4 Q2. The way I work, I would prepare the upgrade on my local development PC. I would probably not only upgrade SF, but also add content, change some of my user controls, custom classes, and do whatever else is on my to do list. Now I have a new version sitting on my local PC, which includes everything but the up to date user membership data and the forum posts.
I wouldn't know how to proceed here. FTP'ing the new files to shared hosting is not the problem, but how to get the user data in the new version of my site? To make it even more complex: the schema of the database tables SF is using for the forum data may not even be exactly the same; Q2 may introduce minor changes to some tables that have to be configured in the life database.
This is just an example. Perhaps I'm missing something obvious? I feel it can all get rather complex but may be it's not :-)
You can transfer content with Site Sync. Configurations and users are still not covered by this feature.
It's a long thread and I am not sure what exactly is the current issue. Please, let me know if you have a more specific question.