The difficulty interrupting something like 'yes' is a known issue. We need to add some flow control to deal with cases where the network overwhelms the UI. This also makes hterm appear slow when cat'ing /usr/share/dict/words, and running aafire. A fix is in the works.
Yes, as you mention, automatic updates are something you already accept with Chrome. It also seems to be the way Firefox is heading. And Android and iOS apps. Anyone is free to build a version locally if they really want to stick with a particular version.
The webstore may require an account, but the source is open. You're welcome to build it yourself. Or, create a throw-away account and download the CRX, then install it in your "real" account.
Of course the current version is buggy, it says that right in the web store description! I've been working on it for a few months now, but it's difficult to get everything right in a terminal without a lot of users. I fixed an issue after the 0.7.9 release that may be what you're describing, but I can't know for sure without more details.
FWIW, as the FAQ says, the terminal emulator and the NaCl SSH client are essentially two codebases. Maybe you could impress people by creating a good-web-citizen version of the SSH command and combine it with hterm.
That would most definitely require an HTML-to-SSH relay in the middle (which hterm supports). Then you'd have to trust that though, at which point you have to decide where you really want your potentially untrustworthy code to live.