I don’t know how viable creating a general utility would be. If someone could create a utility to do this and then send it out to hosts to customize and add to their servers, that would be cool. I don’t have the codeing knowledge to do this.
Looking at Fantastico might be a good starting place. I have Fantastico on my hosting account. It creates a Word Press blog and database, but it does now allow upgrading of blogs. I do this through FTP, just like I am sure most other users do. Creating a utiliity that actually upgrades Word Press would probably prove more difficult.
Getting a utility like this on hosting accounts would probably expand the Word Press userbase.