While I agree that glass can take you farher than camera body, I DO agree that an upgrade from one brand of camera body (I.E. T1i to T2i) is usually not worth the $$$ spent, unless the upgrade fits what you need to get the photos you are after.
I have a friend who says this about buying camera equipment. "Buy what you need, stay within what you CAN afford, and LEARN your equipment well."
I love the last part because a guy with a rebel who KNOWS his camera inside and out can "out shoot" a guy who owns a 1DX and doesn't know how to operate it properly. An upgrade simply to upgrade, because someone want the "newest and greatest" will often be quickly dissapointed with the purchase, simply because he/she never took the time to LEARN his first camera to begin with.
3 years ago I upgraded from my XTi to the 40D for a couple of simple reasons. 1) I shoot mainly wildlife and the 3fps of the rebel missed a lot of shots and the 40D's 6.5fps were perfect 2) I was happy with the 10.1MP sensor because more megapixels do not automatically mean a better photo, and 3) I have large hands and the 40D fits better in my hands than the rebels do. It was not worth it for me to shell out the $1600 for the 7D because it was way outside of my budget.
But at the time, the 40D's were in the price range (used) of about 500-700 bucks and the 50D's were commanding upwards of 800-1000 used (as they were still new at the time). The 40D is a very overlooked camera because of it's short life span (Canon released the 50D within a year of the 40D's release). Many people assumed that the 50D was a better camera so the market got flooded with tons of very lightly used 40D's. I got mine at the time for $500.00 bucks and I loved it.
The 40D for me as the perfect upgrade. In fact I still keep a 40D as a backup/macro camera to my 7D and shoot with it on a regular basis. The only reason why I bought the 7D wasn't because I wanted an upgrade, but my 40D was ripped off and my ins company paid for a replacement. I paid the difference and bought the 7D. I love my 7D but I also love my 40D, it fits my needs and it's a very easy camera to use and consistantly produces outstanding photos.