no,
live upgrade works on stand alone systems. I works in conjunction of drives setup with SVM or some call it(sds).
or with normal c#t#d#s# numbers.
depending on how you have your drives layed out. most people, even me with some of my hosts, I break the mirror and use live upgrade to against the now non attached drive.
On new systems I build, what I do since most drives are pretty large in size. I allocate to partitions on each disk for live upgrade, slice 0 and slice 3. long story short, initially I build my OS on slice 0, down the road if I want to upgrade to say S10 update6, I upgrade slice3, now I can bounce back from the original boot environment to the new boot environment, AND never loosing redundancy during this whole process. This process also works well with patching.
At Sun's website you can download very good white papers on live upgrade, it is very easy to use and there is a lot of thought put into it so it is pretty hard to mess up,