As others have said, personally I think automatic updates sounds quite iffy. It will depend on the implementation.
If you look at the current system for buying Apps over the air (i.e. limited by file size if you are not on WiFi) I would imagine that would extend to over-the-air updates too. That would, to some extent, alleviate some of the battery life and data allowance cap concerns.
Also, if iOS 5 does not solve the maddening issue of 'updates' basically being the whole app downloading again (just as with the OS point updates) it would be a major pain in the backside to have the phone updating huge files in the background, even on your home WiFi, which is also (increasingly in some places!) subject to caps of its own. The answer would be to selectively apply controls on a per-app basis - if an app I use every day has an important update I might want to expressly make sure that is updated (or the opposite - as some have said, updates can be bad as well as good), or I might like to limit updates by file size regardless of whether it's by WiFi or 3G.
Having said all that, I am not sure Apple will give us enough granular control over this feature to make it something I'd be interested in. Personally I have no problem in updating on the computer and syncing. As long as they make this easy to turn off though, I can see it's something others might desire.