Eclipse 4.2 Juno was released on June 27. Usually I wait a while to make sure that plugins have been updated to work with the new version, but I thought I'd give it a try and I found that all my plugins still worked.
So far I haven't run into any problems with Juno. I've seen some complaints about the UI changes, but I don't mind it. I got a few warnings from the new null analysis, although none of them turned out to be actual problems.
I did run into an old problem when I updated my C++ (CDT) copy of Eclipse - it crashed on start up. I knew I'd run into this before but I couldn't remember the solution. It turned out to be a bug in some versions of Java. I found I wasn't running the latest and after I updated the problem went away. See Bug 333227
It is possible to update an install of Eclipse 3.7 to 4.2 in place, but I prefer to do a clean install from a fresh download. It may be overly paranoid but I figure it can't hurt to start fresh. You can move your plugins over from a previous install using File > Import > Install > From Existing Installation. This saves re-installing them one at a time.You can also move your Preferences over by exporting them from your old copy and importing them into the new one. I haven't found any way to move my perspective layouts, but my normal layout is simple to recreate.
From my experience, if you're running Eclipse, I'd say give Juno a try.