I have never had serious breakage after a distribution upgrade due to PPA repositories. Au contraire, the upgrade manager takes care to disable third party repositories automatically.
Now, that doesn't mean that things are always flawless. My main complaint is with a) bugs in the release itself, and b) the many reckless changes in paradigm, sometimes flawed by design, and implemented with half-finished software (upstart and Unity come to mind). Because of a), I usually wait a month to upgrade.
b) is more serious, and though it sometimes isn't Canonical' s fault (I'm looking at you, Gnome!), it is why I dread dist-upgrades. Finding reasonably functional and bug-free alternatives to the junk they want to shove down my throat sometimes takes months. For instance, I have only just yesterday found a decent desktop to replace Gnome2 (Mint's Cinnamon), after being homeless since the release of 11.04.
Still, I wouldn't swap Ubuntu for any other distro (not even Mint, which is just another _buntu, so why bother)! The PPA system is brilliant. The community is huge, so even if bugs aren't fixed, workarounds and patches abound.
And last but not least, it's the only distro I can even consider doing a dist-upgrade with the hopes of having a working system after it's done.