Which is the right process to upgrading projects to newer versions of UDK including art and source. I am having a project in 4.8 and would like to keep it up to date with each new released version on the fly.
We try to keep the process for upgrading projects from one Engine version to the next as simple as possible. The upgrade method that we recommend is to open the Project Browser window for the new Engine version, select your existing project (it will be grayed out since it is associated with an older Engine version), then click Open (or double-click on your project in the window). This will open a new window prompting you to upgrade your project. We recommend that you choose the setting to “Open a copy.” This option will create a copy of your project and upgrade the copy to the new Engine version. It leaves your original project intact and unmodified, so if a problem occurs during the upgrade process you still have the original that you can use.
Once you click the “Open a copy” button, the Editor will attempt to upgrade the copy of your project to the newer Engine version. In most cases this will be successful, but there may be issues in the upgraded project that will need to be addressed due to changes to the Engine source code. To help work through these, it is a good idea to skim through the release notes for each new Engine version so you can see what changes may impact your project.
One other thing that I would like to point out for your case specifically. Since you will be upgrading several versions of the Engine, we would recommend upgrading one Engine version at a time. This is generally safer for your project than upgrading several versions in one attempt, as it will allow you to address any impacts each Engine version has had on your project.
Lastly, it is not generally necessary to upgrade your project every time a new Engine version is released. If you have a version of the Engine that is working for you and has all of the features that you need for your project, then it is perfectly fine to stick with that Engine version all the way through the project. Upgrading projects does carry some inherent risk, so we typically recommend upgrading only if you need a new feature or bug fix available in a newer Engine version, or if your project is nearly complete and you will be able to take advantage of any performance improvements that may be available in the new Engine version.