I released an update for my App and it was approved. It was approve despite the fact that it included a serious localization bug where most users are getting the wrong language.
I believe that you can prepare for problems by creating a fallback version with a higher version number and submitting it for approval with manual publishing. That should cause it to be quiescent in your store until you choose to fall back, and you publish it.
I am not certain whether you can then submit improved versions with a lower version number than your fallback version.