Yeah, this has been annoying me. I find I can't remember exactly where it was before for less frequently used apps and end up with a few hours of vague discomfort with my phone because something isn't quite right. I've started moving the icon whilst it's downloading to a position beside the current one so when it's finished everything sorts itself out.
I have a feeling that it isn't updating as such, more replacing the app and it keeps the old one around until it's finished in case you lose your connection and are stuck with a half downloaded app. This is very sensible, but shouldn't manifest in the UI. Keep the old icon hidden and replace it with the installing icon. If something messes up, unhide the old one again.