> If we use the backup then we would lose any changes made in the meantime. Is there any way to retain that data?
To my knowledge there is no way of merging two sites, definitely not from two different (major) versions.
> We carried out testing on our pilot server and it appeared acceptable but this testing could only be limited. In a full production environment this has not been the case. We will be looking at our procedures in future.
I know it too well. Customers need shiny new Moodles, as if software wear and tear. We first migrate a copy and give them for testing. If they can open a couple of courses and the design is right, they are satisfied. Well, till somebody starts working with the shiny new thing.
> How much responsibility does the community take for ensuring that the product is thoroughly tested before it is released and damages the reputation of the product?
The community? None. AFAIAC free advice, free of liabilities. But as you said, the reputation, yes, that hurts.
Moodle HQ makes the strategic decisions on all aspects of Moodle. By extention they may be morally responsible, but legally it is clearly stated in the licence http://www.gnu.org/copyleft/gpl.html clauses 15 - 17.
> Perhaps the decision to produce versions every 6 months needs to be reconsidered.
You speak the unspeakable! No comment, sorry all spent.