As mentioned before: that's not gonna happen, for a lot of reasons.
1) Some updates require a factory default reset.
2) The router architecture cannot ensure that an update won't require a manual router reboot. You need a device with dual firmware storage for that kind of feature - this is why business class products will sport an active and a stored firmware versions. Those are the only devices that are safe to be used in an automated update environment, as the firmware gets written to a partition that is separate from the live one
3) Randomly disrupting someone's internet connection through an automated firmware update is a bad idea
The best that could be done with these routers would be email notification when new firmwares are available.
- The update can be done after the router have been idle for a while.
- And on/off choice for this feature - with on as default. Then it's at least more up to the user.
- The software can be designed so that the web browser will display a page to reboot the router. It's can be a solution for critical updates, not for all updates.
- A disruption 1-2 times each year to improve security? I'll think most can live with that...
- Can a update be a solution that changes only a setting?
- Can the router display a webpage when surfing - once in a while - that a critical update is available and a update is recommended?
- Can a router start flashing all it LEDs to tell a user that a update is available?
- should a admin e-mail be set in the router on initial setup, so that messages can be sent when a update is available? Not a registration sent to the manufacturer, but only to send diagnostic messages - and telling the user why it should leave a message there and telling that this e-mail-adress is only stored in the routers configuration.
- Should UPnP designs be changed in a way that UPnP-setups have to be user confirmed? UPnP is "practical", but with ShodanHQ.com now, fyou don't have to understand much to be a "hacker"...
The security for such devices needs to be rethought. Maybe there should be changes from the initial design. Yeah, it would take years before old products are taken out of use, but it is a start.
But also - changes like these will have no effect if the manufactures don't update their products. Asus was aware of the FTP-issue for half a year and did nothing. There is a lot of known security holes on routers. Before they are disclosured, the manufacturer is normally told. But the feedback I got from penetration testers is that many of these companies don't take them serious at all. There are even threats of legal actions if they take it public. So there a router manufacturers that rather take legal action instead of fixing stuff - even on newer products that are still in sale... that really improved the security.....