I believe a precedent for this must exist... when the Java 6 JRE was released, were users of the Java 5 JRE automatically updated to Java 6 JRE?
Or to put it another way, are automatic update capable of moving you from one major version to another (e.g. from JRE 5 --> JRE 6), or do they just update the "maintenance" releases within a version (e.g. JRE 1.6.0_25 --> 1.6.0_26)?