I updated to the latest kernel with entropy, but I had to manually edit the /boot/grub/menu.lst to put the latest kernel at the top of the list. Moreover, removing old kernels does not remove the entries from the /boot/grub/menu.lst file. I believe it would be beneficial to have entropy edit the /boot/grub/menu.lst file and do these edits when updating the kernel.
Out of curiosity, I recompiled the kernel with portage to see what would happen, but portage doesn't do what I want it to do either.
You can also use extra parameters for other genkernel functionality. For example, if you wish to configure some extra kernel options using menuconfig and you wish genkernel to automatically update your grub boot loader configuration, then invoke genkernel as follows: