Honestly, this is one of the features MoP could have done without. It just feels like an unnecessary valor sink. I can deal with having to get new gems and enchants when I get new gear, those are cool, but having to farm another 500 valor per item is just pointless in my opinion.
I don't think it adds anything to the game other than making the general ilvl of gear rise faster. It should just be scrapped completely. Whether something like being able to buy gem sockets gets put in its place I'm not sure, but item upgrades just haven't really added anything useful to gearing up in MoP.
Interested to know what everyone else feels about this.