Took a while, but me and Vanquish have now connected. The weapon upgrade system isn't explained all that well and in essence it's almost counter-productive as you shouldn't use the weapon you want upgrading so it's always at full ammo and any time you scan in the same weapon on the battlefield it goes towards upgrading your weapon rather than being an ammo refill. My hangup with it was determining if it was persistent, or if maybe you traded a weapon for something else then all the upgrades you applied were lost, but it just dawned on me tonight that it's not the case.
But yeh absolutely cannot complain right now. Well, aside from the story, but it's completely irrelevant as Vanquish is an extremely fast shooter that makes Gears of War look as slow as hell in comparison. Amazes me how something like this can process huge explosions and lovely particle effects at 60 fps, but a farting animation in Fable delivers framerate issues.