We used Webparts inside Updatepanel until before Beta 1 without any issues.
From Beta 1, once if you do any operations (Drag & Drop, Minimize/Maximize) with the webparts title bar then it won’t allow you to perform the same actions again.
After reading the “Federico Silva Armas”( farmas - ASP.Net Team) reply to the thread
http://forums.asp.net/thread/1436225.aspx
I thought the above said issue will get fixed in Beta 2. But the issue still exists in “ASP.NET AJAX 1.0 RC”.
Since the ASP.NET AJAX RC provides a preview of the fully supported version of ASP.NET AJAX scheduled for release in January,
Whether you guys have any plan on supporting the Web parts inside the Update panel ?
Whether it is worth to wait? Or just forget about it.