Installing a kernel without rebooting is it really a great idea? This is one of the best articles I have seen explaining the new Ksplice Uptrack software. While the author Christopher Smart does a great job showing an example of when you might want to use it on a production server. I found was missing any real effort to warn people about using this in a production server.
It's a situation where just because you can do something, doesn't mean you should. I love OpenSource and trust it to do my job every day. At the same time I use software from the three of the largest software makers in the world. In both situations both I and the developers of the software have "Human" days. Whether it's software I support under a multi-million dollar contract or Free OpenSource Software it's all created and deployed by Humans. By "Human" days I mean that we make mistakes and aren't perfect and there are days when we just can't avoid it no matter how hard we try. So risking my business by doing an in-place update of the kernel during my production day is never a good idea. You should always plan and execute these types of changes during the least impactful day and time of the week. You should never build your business on the premise that any given system that can't ever be down. If the system is that critical then it should be built to be redundant.
More than once I have installed kernel updates only to have user land software fail to start afterwards. So if I put a kernel update in without rebooting and there is an issue with my web server software then I can crash the web server and cause an outage. Do this more than once in the middle of a production day and you would be looking for a new job. Kernel changes are no joke no matter how or when you do them. Every linux distro let's you install multiple kernel versions for a reason. Tread softly with this new tool in your tool box. Don't forget to test your change before you implement it in Prod.