Of course depending on the distribution you use, all the basic testing work is already done by maintainers before you get access to the update.
Now if you're updating the kernel on your own, that's a different story.
But yeah, things breaking to the point of being unable to boot is pretty rare these days (and yes you normally always have the possibility to use a fallback kernel in this case - if your install doesn't provide this, your should consider adding it yourself!) Now if you don't have a fallback kernel, you'll have to boot with some live CD to get your system back to a working state.
Now, third-party drivers/tools dependent on the kernel MAY break. This happens once in a while. Especially on older hardware. I have a Lenovo laptop for instance, and very occasionally a kernel update breaks some functionality specific to the laptop, such as hardware monitoring, or fan control, or graphics card switching (my latop has 2 graphics cards, NVIdia plus integrated Intel.) There are just too many possible configurations to ensure that this never happens. But the frequency of updates doesn't really matter - it's what they change that does. As with any other important update, do not do it if you are in a rush and know you won't have time fixing something that may have broken.