Just a thought..I updated 4 AppleTV's 2-720, 2-1080p, all with no glitch at all. Having AppleTV's since the original I know the updates take very long to go through the process for some reason. The updates do at times seem to be "Frozen" when they are in fact not. I have had 2 friends complain that it bricked their AppleTV, but upon asking a few questions..both admitted after a while that they tried to reboot or pull the plug to reboot thinking the update was stuck which more than likely caused the bricking. I'm not suggesting that is the case with all, but it might be more common than people will admit to.
I was thinking the same thing myself. I set my ATV2 to update while I was exercising and something close to 40 minutes to an hour later, it was still updating. 10 minutes later it finished and all was fine, but I can imagine there were probably some LOOOOONG points that seemed like it was dead. I'm glad I wasn't watching all that time.