I installed the Ambiance Evolution Theme from a custom PPA, which overwrote the original Ambiance. Same for Midori, Flash and other apps. Is it advisable to downgrade these packages to the Ubuntu-provided versions before an upgrade?
Yes it safer to remove PPAs and their packages. Ubuntu upgrades are tested for default installations, not installation in which everything is changed by PPAs. By removing extra repositories (not just PPAs, but also third party repositories) and their associated packages, you return the system to their original state.
After the upgrade, you're free to install your preferred PPAs of course.
No, it is not safe to simply remove a ppa through the package manager without restoring defaults. This can cause unwanted side effects (e.g. if this were graphics drivers you will have no access to the GUI).
To fully reset your system to defaults and to remove any unwanted ppa we may use the script ppa-purge
sudo apt-get install ppa-purge sudo ppa-purge -purge <nameofppa>
sudo apt-get update