I think that the Chrome approach is the right one. Browsers aren't like anti-virus programs that kill computers so forcing an upgrade is a good thing. I've seen way too many people tell Firefox to ignore the upgrade because they are a hurry to do something on the web and don't want to be bothered.  Additionally Firefox doesn't prompt for an upgrade between major versions, so when 4 comes out, there will still be lots of people using 3, 3.5 and even 2.x.