Hi Spence, Eugene,
The Data ONTAP 8 Simulator *is* technically upgradable, but there currently is no image on NOW that can be used to upgrade it. When you try to download a new Data ONTAP image from NOW, the first step is to select the controller for which you're downloading the software (e.g., FAS2040, FAS3170, etc.). The simulator virtual machine is a platform, just like the different types of hardware platforms NetApp offers. So when you try to upgrade the simulator using using the image.tgz file from a different platform, the type checking might pass (it shouldn't and should tell you that the platform is incompatible), but the image itself isn't going to boot. There are too many platform-dependent drivers, optimizations, etc. for the same image to boot across such different platforms.
The NetApp simulator team is discussing what it would take to add the simulator as a platform selection for Data ONTAP image download. Working through the process is always more complicated than one would think or imagine When we figure it out, we're unlikely to provide images for any older releases of Data ONTAP. For new version of Data ONTAP posted to NOW we should be able to include the simulator as a selectable platform. That said, I explicitly want to set the expectation that at this time there is no particular date or Data ONTAP release when this is going to happen. We're just starting to work on it NOW (pun intended).
Take care and hope that helps,
Miroslav