I succesfully experienced this:
- Stop the service
- Replace the old EXE, DLLs and stuff by the new one using a file copy
- Restart the service
It works pretty well, unless your service name (or EXE filename) has changed: then you will have to uninstall it and reinstall it.
I do not use strong naming nor GAC features, and I do not know if restrictions applies in such a case.