Yeah, I do want to "blow" my gold on crappy warriors and archers, I get it free from the AI anyways.
Edit: Oops, I go on tanjents too easy.
To answer your question, my point is that the speed you play at probably (ive played Normal speed once in my life) has a huge impact on whether this is a smart strategy. It also probably has a huge impact on whether or not to upgrade your troops. I always upgrade mine because my "friendly" AI friends don't seem to mind donating gold to my cause every so often. I'm a big proponent of spending the gold that's in your treasury -- the time value of money seems to hold no weight in civ, so it seems most effecient to spend it on things that can benefit you immediately. What the hell is your savings account going to get you? Granted - once it's real late in the game and I'm running Universal Suffrage, then I'll sometimes save gold to rush buildings in under-developed cities and whatnot, but otherwise I find gold totally worthless EXCEPT for upgrading troops, rushing buildings, and running a spending deficit for research. If anyone would like to help me improve my strategy in this regard by making suggestions I'd be willing to listen. I'm trying to break through to diety so every little bit would help...
Er? Why do you have piles of money lying around in the first place? Do you usually have a big surplus even with slider at 100% science? You can hit up friendlies for gold sometimes, but that won't net you enough gold to upgrade lots of warriors -> infantry or anything big like that. If I had a big stockpile of gold, I'd only use it to upgrade stuff that could provide a big bang for the buck, like HA->Cavs or CG-promoted crossbows->machine guns during emergencies. Gold can be used to lubricate trades (including trades to tell someone to war with someone else), fund deficit research, pay off bullies, purchase buildings under UniSuff, building corporate branches, etc. I think JJ or someone else did a calculation on how efficient it is to upgrade and apparently it's more efficient under Marathon? Or maybe I have that backwards. But it's not a great ratio or anything on Normal. Also, I thought Marathon was the speed of choice for those who want to run over the AIs early because your units don't go obsolete as fast... in which case you won't have much need to upgrade many of them, or even if you do, by that point you probably have half the map anyway so why are we talking about this.

P.S. Speaking of efficiency, it's more efficient to upgrade troops by sending them to vassals which get big discounts on upgrades... though in practice this usually doesn't work out too well because the AI sometimes won't upgrade them, and sometimes you don't want them to get too big of a military as they might even capture an enemy city that you didn't want them to capture. Still, I gift them anyway. Less maintenance for me, higher combined power rating for us, and maybe the AI will use them where I want them and not ignore me when I ask them to attack city X!