Don't ignore the update sitting in your Settings app; you'd be leaving your iPhone's security vulnerable.
The block could be reversed on the previous version of iOS, but it's highly likely the average user would not know how (especially if they could not use Safari to look it up). If encountering this bug, the user would have to go into their Safari settings and clear the cache. This would free the app and remove the threatening messages.
Lookout discovered this bug last month, and shared all information gathered with Apple. Apple subsequently fixed the issue, so now, popups open in a new tab instead of popping up over the app. This frees the app for use without having to close out of the popup.
If anything, this is an important reminder to always keep your phone updated to the most recent software available, as Apple, and other companies, routinely issue updates to fix security loopholes such as this. In fact, sometimes, you may even find added security features that weren't there before.