The biggest issue is once an incompatible patch happens (either with or after an upgrade to the graphics engine), the older versions become obsolete and players with low spec systems can essentially no longer player LFS as it was intended (i.e. online). Now eventually this is inevitable, so there will come a point where you have to drop support for these lowest spec machines, but you have to do it when the proportion of your userbase is effected is very small.
Maybe with Windows 7 proving popular, XP machines will start to reduce in significance much more quickly, meaning it would be sensible to switch to the latest DX version in maybe just a couple of years.