There are risk, that a newer version of an image will accidentally, break things, apply breaking changes and so on.
Good, frequent, tested backups, could be a mitigation to this. If an image breaks, you just restore your data from the backup, and pull the older image.
I use the klausmeyer/docker-registry-browser, and that recently broke, but it just needed me to provide an additional configuration variable.
I use advplyr/audiobookshelf, which upgraded to a different database engine and schema a couple months ago. For some small subset of people (including me) the migration to the new database didn't go well. But I had a backup from 6 hours before the update, so restoring and then using the older image until the fixes were released was easy.
Even with the occasional issues I prefer letting watchtower automatically update most of my images for my home. I don't really want to spend my time manually applying updates when 98% of the time it will be fine. But again, having a reliable and tested backup system is an essential part of why I am comfortable doing this.