Decent article on WPRealm discussing [why users don’t upgrade][art]. The biggest reason I’ve found is that their web developer failed them.
Any client I’ve talked to that is not upgrading their site is afraid of something breaking. While that may be the reason they give, it’s not the real reason.
Really users aren’t upgrading because their developer didn’t set up a solid back up system and then instill confidence in the user. Every client I work with gets set up with [BackWPup][back] or [Backup Buddy][buddy]. Then they get a video on how to use it and restore.
Once I’ve set them up I’ve never gone back to a site and found it on old versions of WordPress or plugins. A little education goes a long way.