So, here's so more information I gathered from GBATemp.
Apparently, there are three exploits in development with one that was already released.
- Userland: This is the weakest form of the exploits. It's really only good for very weak homebrew and can't modify existing games. This exploit was patched in 5.5.1 as it used an MP4 vulnerability (the system would read a corrupted video to generate code.) It was released for users on 5.4.0 and 5.5.0 a couple hours ago.
- Kernel: This is essentially the middle ground of the bunch. While it doesn't allow full level control over the system and doesn't give the entire power of the console, it does give you the ability to modify pre-existing title (game modding) and more powerful homebrew. As well as Game "Back-ups". This exploit was not patched in 5.5.1 and has yet to be released.
- IOSU: So... this is essentially the mother of all exploits. It allows for system level control of the console and could lead to modifications to the Console's Operating System (for things like Custom Firmware) and Emulation of the Systems Firmware on a different device. This means the system would be cracked wide open and you could use the entire power of the console as well as the entire hardware. All the features of the past exploits are there as well. This exploit was not patched in 5.5.1 and has yet to be released.
So, the only two exploits that can work with the Smash Custom Music Tool releasing in February have not been technically patched yet. So in essence, you could theoretically update your console right now if you wanted. As Hykem's IOSU exploits is rumored to be released in February along side the Smash tool and the final DLC pack for Super Smash Bros. for Wii U/3DS.
In my own personal recommendation though, if you are looking for Custom Music, I would wait just a little while longer to update your Console. Information is still coming out about the latest firmware and plans do tend to change. I'll keep you guys updated on this current situation.