Update when you see something you like. For example, recently we added Album Art. That would've been a good time for many people to update, since they wanted that feature.
Basically, "If it isn't broken don't fix it." Update either if you want to stay on the cutting edge and help report and fix bugs, or only update when you see something fixed or added that you know you want. No reason to really do anything between, unless you just randomly decide to see what's new.