Yeah, Ive pulled that trick once or twice on the AIs when switching from one weapon choice to another. It works, but it aint cheap, and if you arent careful, you can sink your economy.
As for the "easy upgrade" feature, I think it works fine. If my ships are close to one of my planets or deep inside of my territory, then the upgrades are quick. IHowever, if you try that around an unincumbered AI (especially with Brad's new tweaks) and your gonna be toast because of the long upgrade time.