Don't know for sure but I think the updates are initiated from the plug. As such, I don't think the root password is used for update.

This question was answered by s4mb4 on OpenPogo's forum: Yes, you CAN change the root password without any harmful side-effects.

I'm guessing the error you got was:

passwd: cannot update password file /etc/shadow

The password is stored on the read only file system. You need to mount it as read/write with:

mount -o rw,remount /

and then put it back to read only after you've changed the password with:

mount -o ro,remount /

what is the command/procedure to change the password after mounting th DS as R/W?