How to avoid GRUB errors after running apt-get upgrade - Ubuntu

There is a current bug opened for this located here and it was also present is 12.02 LTS as seen here. The steps listed in the bottom of the bug report by Anders Hall do work for the 14.04 LTS 64-bit (HVM) AMI (ami-d05e75b8 in US-EAST-1):

$ sudo apt-get update
$ sudo rm /boot/grub/menu.lst
$ sudo update-grub-legacy-ec2 -y
$ sudo apt-get dist-upgrade -qq --force-yes
$ sudo reboot

Upon reboot the 14.04.2 LTS was upgraded to 14.04.3 LTS and sudo apt-get update && sudo apt-get upgrade returned 0 new packages.

I've gotten this myself a couple of times even though I never did any custom changes to the menu.lst file. I don't know why this happen, but I chose to compare the file and saw that it was mostly comments and references to newer versions of the kernel that had changed. There is an open issue about this in the apt bug tracker.

You should be fine with overwriting the old one with the new one (option 1), as long as you didn't do any manual changes to it. I would recommend you to create a backup AMI of the instance before updating, just to be on the safe side.