The inflated Android OS stat is artificial- the Google engineer confirmed that on her Google+ account, and it is supposed to be resolved in Android versions 4.0.4 and above (apparently it didn't make it into HTC's build for the One X, 4.0.3). In essence, that number is inflated because certain system processes get counted twice, so she fixed the algorithm. The algorithm determines how the OS communicates with the battery (and vice-versa) so the fix should improve battery life.

 

There are three levels to Android OS updates, and there are two different types ("Updates" versus "Upgrades," to use Motorola's terminology). "Upgrades" are movements to a new OS release (think from Windows Vista to 7, Mac OSX Snow Leopard to Lion, etc. except in the mobile world, this is provided from the manufacturers if feasible because they often include important enhancements and security improvements), while "Updates" are minor releases that (usually) address specific issues/bugs/features that need more immediate attention.
Now, the three levels I spoke about are:

1. Google (actually not really Google but the Android Open Source Project, a division of the Open Handset Alliance that is housed & funded by Google)
2. The Manufacturers
3. The Carriers

1. Google/AOSP fixes issues and comes up with cool stuff all the time, so they add these "patches" into the online repository for what is the cutting edge of Android as an OS. Once enough of (or sufficiently critical) these accumulate in the newest version of that online repository (or "fork"), a "release" is generated and goes into testing and eventually gets packaged into an OTA release candidate. This is pure "vanilla" Android at this point, no Sense, Touchwiz, Blur, etc. Typically the OTA will then go to testing for release to the Nexus (pure Android) devices and then get pushed out via OTA. That is the limit of Google/AOSP's involvement.
2. The Manufacturers watch this online repository and pull down the patches and pieces of relevant code to their devices. Then they begin re-working them so that they work on their devices (make sure they have the correct drivers for the specific hardware and such), and then begin adding their "enhancements" to the OS (i.e. Sense and Touchwiz, and Blur, etc.). Then they test their additions to the code, and eventually package it and get it ready for release to their devices. Typically at this level there are several devices with different hardware, so each device is developed for individually (motorola is supposedly working on pushing updates that formulaic-ally call on the drivers, so they can code the update for all their devices and thereby speed up the process, but I think they were hitting issues), and so it can take a bit of time, but usually they release each update/upgrade as they complete it. Unlocked International devices (not carrier-branded/ carrier-specific) get their updates at this time.
3. Lastly, if it is a carrier-branded device the Carrier can decide whether they want to add any of their specific applications ("bloatware") and also test the updates/upgrades themselves (usually there are little tweaks to their proprietary radio and baseband code), beofre okaying the release and sending it out to their devices.

The releases usually sit on a server at Google once completes, and everyone should install a LogCat app (or similar) so that when you get a notification for an official release coming to you OTA, you can grab the URL and share it, then others can point their browsers to the URL and grab the release themselves prior to waiting for the notification. Notifications to download the OTA releases are sent out in batches, based on your IMEI number (think serial number for the device) and chosen randomly.

Also, if you decide to root and install custom ROMs, most of those developers are writing their code based off the "AOSP drops" just like the manufacturers, so they tend to "bake" features into their ROMs much faster than you will get it via official OTA, but there is the process of rooting (not hard but will probably void your warranty), and almost weekly (typically) flashing of an update to the ROM (for new goodies) as trade-offs for getting the latest and greatest. I've lived in both worlds, and I now prefer to just wait for the OTAs simply for time reasons...

Hopefully. Sometimes a poorly-coded or rogue app can hijack a few processes and really push that number up there. If it was the official Google Reader app, I would wager that its issue was that it was trying to do something (check for updates) but was being blocked/interrupted for some reason and so never closing out that process...

Always read the reviews of apps to see if there are known issues that haven't been patched yet (read the reviews back at least to the last update date for the app)!

 

Good thinking! But unfortunately not, because the OTA releases are incremental in nature, and written so as to update a certain software version number to another software version number. To jump backwards (firstly would not work because the bootloader would not know what to do with the file) would be bad because an update might change the way a system calls a process and where the code for that process is stored, going back to the old software version would create an issue because it would be looking for code that isn't where it thinks it is. Going forwards likewise might skip important steps (each update is written with the presumption that the device is on the previous version), and likewise cause issues. So yeah, short of rooting you are locked to the full path releases have to follow for your device.
You can revert back to previous official versions, but you have to use the full ROM image to do so and it is a bit more complicated than the update process (it is done like rooting/flashing ROMS). The release files are not (usually) complete ROM images...