It is recommended to set a password. This will grant access to the web GUI, whereas an SSH key will only allow you access to the SSH command prompt. Most configuration items in pfSense® are typically controlled via the web GUI. If you accidentally use an SSH key instead, you can select the option to reset the admin password at the text menu that appears when you ssh to your instance. Then the web GUI password will be reset to “pfsense”. You should immediately update the admin password to a more secure value once you have successfully logged into the web GUI.
Versions in the 2.2.x range should not attempt to have a firmware upgrade executed. In the future (pfSense 2.3 or later), this may be possible, but it is currently untested and unsupported. Since a real system console is not available, a definitive recovery process for failures during upgrades would be difficult to define. The currently recommended process for upgrades is to backup your pfSense config from your existing instance and restore it on a new instance when an upgrade is available.