Whenever I hear "X technology makes Y functionality too easy", I cringe. It's ease of use is not the problem; in fact, that is its great value. The fact that the implementation is hidden from you is the problem. In fact, that's my problem with many MS tools/frameworks/etc.: they make it easy to get started, but they don't give you the option to dig into the internals to solve the really tricky problems. With the UpdatePanel, I believe you can dig into the javascript files if you're really interested, but I'd much rather have a handy debugger visualizer that showed me exactly what was being sent and received in each ASP.NET AJAX request.
And on your point of "you're doing it wrong" by setting the visibility, your blanket statement is not accurate. If the div contains ASP.NET validation controls, you need to set the visible property on the div. If you just change the display style, you'll end up with a validation control hidden but preventing (possibly) the page from being posted. That's a very bad and confusing thing.
