its basically a kernel update. just be warned that once you upgrade to the newest kernel, there is no going back at the current time, and the newest kernel doesn't support the hypervisor hack (runs unsigned code).
if you try to connect to live, or you play a game released after febuary 15th, you will be forced to update. i would personally try to push that off as long as possible.
depending on how confident you are in your soldering abilities, there is a resistor on the board that you can desolder prior to updating that will allow you to revert back to the old version (since removing the resistor prevents what is called an e-fuse from blowing).
to sum it up,
if you get the update, you can still flash your dvd drive, but you won't be able to downgrade your kernal for the hypervisor hack unless you remove a resistor first.