I think the ships should *NOT* be significantly upgradeable beyond their tier. Maybe some averaging of stats and caps and such as you go up, but that's about it.
Rather, I would suggest a bonus to skill points, merit points, or etc. for victory with a lower tier ship, on the basis of saving the Federation/Empire the resources of using a newer, more expensive ship.
Either that, or you should be able to let some of your inactive boffs fly one of your lower-tier ships for you as an NPC follow-along assistant, much the way your boffs help you out on the ground. You could send them to collect anomalies for you, or take things to the bank, or go to a merchant to buy and sell for you, too. :p
I think the consensus is that ships don't need to be "upgraded" per se, rather allow the lower tier ships as skins/costumes at higher tiers within their normal categories.
Again, I would vote NO on the cosmetic ship exteriors, in general.
I would support having some of the most iconic ships be given a "refit" variant that is one tier up. For example, Riker's NCC-1701-D Enterprise refit, with the BFG spinal mount from "All Good Things". (If that spinal mount turned into some nice raid loot, I wouldn't mind so much, either. )
I'd also support special areas where you can play alternate eras in fleet actions or PVP, and take out your "older" hull for a nice romp.
But no, in general, I would not support cosmetic skinning.