During our small Closed Alpha, we rolled out 3 new server builds and completely moved players from one build to the next without interrupting gameplay. Players never noticed a difference (other than some bugs went away).
We will definitely be rolling out new server builds to fix issues that we find. Not every issue can be patched entirely on the server, and so some fixes will require a client patch. But new server builds are definitely something we will be doing.
Seamless updates are due to the stuff we've written. The fact that we can somewhat-easily deploy new builds on Azure is due to the Xbox Live Compute team's hard work. This is an area that we've been working on with them for some time now. We originally told them that no-cert, fast server updates were a requirement for us, and they made that happen.
