Has anyone else tried this? What I'm experiencing is that if a release version of an app is already installed, attempting to update to a beta through Apple's testflight distribution fails- the download starts, but never finishes. Not only does the beta not install, but the original install no longer is launchable. I was able to work around only by deleting the release version of the app.
Personally, I tend to believe that the release version should always be deleted off a device before you install a beta build. I do this because I have no idea what apple (or other library providers such as Kamcord) does under the hood for caching stuff (for game center etc) for release or beta builds and if that data is interchangeable. Now 99% of the time I am sure it is fine to do but for my peace of mind I don't want to be caught chasing a phantom bug caused by the 1% of potential problems. On another note, we have been using Birdflight for our beta testing. Not sure if you would prefer to use that? Our reasons were because it also supports Android and because not all our testing devices were on iOS 8.
I don't know if it suits your specific situation but you can at least get promo codes for an approved but unreleased update, and using that will copy over the top of the release version without issue.