I would argue that in the case of Facebook's updating feed that the idea is fine, the implementation is buggy.
What should happen is the new content is loaded above and instantaneously the document scroll position is updated to preserve the previous position. This will allow new content to come in without disrupting your experience.
That's fine for a few updates, what if you have a lot? Memory may be cheap, but why not use it for interesting things? I mean, what problem does an auto-updating feed or endless scrolling solve that are easily dealth with by pagination, expire headers and manual refresh? Other than "user stickyness is not 100% yet" I mean, which I don't recognize as a valid problem.
What should happen is the new content is loaded above and instantaneously the document scroll position is updated to preserve the previous position. This will allow new content to come in without disrupting your experience.