Funny, because two codebases exactly what Firefox is doing with FF 10 ESR, but without the renaming. So I don't find his proposition stupid, at the opposite.
And come on, working on different codebases is a usual dev task, and every developer outside Facebook should know how to do that properly. Usually you have your shipped code and your development code, and you want to be at least able to ship a security fix without disclosing your new functionality.
Concerning your last point, if you don't like that you are probably at the wrong place for web developments, where you should at least support a dozen different browsers. For enterprise software, that means one can just support 10 ESR instead of 1x and everything new that comes at each release, possibly breaking the application.