This should definitely be the way to go. When the LTS is released, fork the LTS into a rolling distro and keep it rolling till the freeze period 1,5 year later or so. Then every developer should enter bug-fix mode and release the LTS. Rinse and repeat. The only tricky part is upgrading core-components.
Combine that with keeping a few older versions in the repository (so if Firefox 18 breaks my font hinting I don't have to go hunting for computers where my /var/cache/apt/archives still has a copy of FF17), and it's definitely doable.
In case of emergency, all debs are archived by and accessible through Launchpad too. (Not exactly a solution for regular users of course, but...)
Maybe they should wait with a rolling release until 'apt-btrfs-snapshot' is integrated and supported well, and an option to rollback is included in the rescue menu.
A problem will be there patches cause their packages are often heavy patched.
They shoud push their changes to upstream or remove them or they will get big problems.
Most Ubuntu patches are either included upstream already (although not always released upstream yet), upstream promised to include something similar to fix a bug (and in that case usually the upstream version will be used once available) or specific to Debian and/or Ubuntu (and thus will probably never be included by upstream).