The main purpose of the upgrade is to allow your ships to start bombardment sooner. Yes you may only get two shots off compared to the un-upgraded siege ship, but that is one extra salvo of damage you have dealt to the planet faster than the un-upgraded ship. Also it will take more time for defending ships to reach your upgraded siege ships if they were positioned on the other side of the planet. So even if those upgraded ships get destroyed, as long as they got off several salvos (or even one or two) because of their range enhancement, you have done more damage to the population of that planet and so you are hurting the enemies economy more than if you had un-upgraded ships where the enemy can reach them faster because the siege ships had to be closer to the planet to fire.
Everything has its purpose. That upgrade's purpose is more subtle than say an upgrade that increases a weapons damage.
