Just  encountered this bug on a desktop system. After the 0.6.3-11 update, the 
boot process hung, preventing background daemons like SSH from starting. The 
contents of /etc/network/interfaces was:
iface lo inet loopback

Adding 'auto lo' fixed it.

This system installed with 8.04 and upgraded to each subsequent release.
I'm quite sure that I never messed with interfaces(5), since the network
has always been managed by network-manager on this box.

This may technically not be a bug in upstart, but the upgrade is
breaking systems, even if the users never messed with upstart or
ifupdown. This might be barely acceptable in a release upgrade (with
extensive documentation in the release notes), but not in an SRU, IMO.
Breaking working systems after release is worse than not fixing a bug.

Is it feasible to automatically fix the broken non-customized
interfaces(5) files? Eg. by publishing an ifupdown SRU and making
upstart depend on that? Or can we notify the user that they need to fix
their interfaces(5) file if they want background daemons and recovery
mode to keep working?

-- 
upstart not starting init-scripts (event net-device-up IFACE=lo missing)
https://bugs.launchpad.net/bugs/497299
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