You should also follow the advice here: http://support.apple.com/kb/HT5550 before updating your FCPX and Motion apps.
There were some fundamental changes introduced in FCPX 10.0.3/Motion 5.0.2 (Onscreen control stuff) and again in 10.0.6/5.0.5 (drop zone stuff).
Newer versions of Motion 5 will create incompatible effects for older versions of Final Cut. (It would be helpful if Apple synchronized the subversion numbers of the two apps.)
In most cases, you do not want to delete the Title Background in Motion when developing a title (or the Effect Source for effects, or the Transition A/B layers for transitions) as these "entities" represent the Storyline the user sees in FCPX. If you need to perform "special effects" on the Storyline content for the effect/title/transition, then you can do what you have to do to create the changes you want to appear in Final Cut. In other words, whatever you do to the Title Background inside your Motion project is exactly what will happen to the content positioned "below the title" in FCPX.