The main problem with blocks with upgrading is not upgrading the system module in the modules administration after the upgrade. Another reason is missing system templates. If you use cloned templates you will have to generate them manually.
Also, you may also have to re edit your module blocks after an upgrade. Updating the system module will return some blocks to default perimeters and will lose their settings. Edit them in the template administration page.
I have upgraded my main site about 6 times and my test sites many number of times, and all without too many problems after upgrade. I will be off this next week (on vacation) so I should be online a little more. Will be moving my site to a private server over the next week also, so if it is unavailable it will be due to my DNS change but should be back very soon after.
Sorry to hear of your troubles. Get with me next week and lets see if we can work through them.
