The update did no permanent damage, so getting a new unit is a waste of time. The new phone will do the same thing if it encounters the conditions that cause the reboot. VZW uses different equipment and different wireless frequencies all over the country, and it is possible that only some combinations cause the problem. Who knows... maybe some network equipment isn't exactly adhering to the proper specifications, causing problems with the phone's software.
We just don't know what is causing the issue for some people, and this is the kind of thing that can take a while to troubleshoot, find the cause, and get vendors working together on a fix.
Back to the original point... It is just software. An updated version will fix the issue.
Did anyone here have the BlackBerry Tour before the Thunderbolt came out? If so, remember the 5.0.0.591 which "bricked" so many phones? Even the bricked ones with the "technical issue" message could be completely fixed by a software upgrade, if the phone was hooked up to a computer. The issue never happened again after the next upgrade.
Basically, it is extremely rare for software to cause hardware damage. I can think of only a few isolated cases (such as accidental overclocking cause by buggy software, not related to phones).