Grayed out for me too...Ubuntu 8.04, Firefox 3.0.13
Try this.
Open a browser window and type “about:config” (without the quotes) and click I’ll be careful, I promise!
The type in the address bar there, “app.update.enabled” (without the quotes), and look to the right. That will tell you if the USER can receive the update or not. (double click the line to change the Value)