Perform the following trick to get better upgrades. Allow your ship to get stolen and then let another steal your ship. Kill one, get the power-up, then kill the other bug to get an ultra upgrade. This can be done with the different bugs.
Galaga Arrangement - Ship Select: To unlock ship selection in Free Play mode complete the game (the last level is level 6-5). This will allow you to select a ship upgrade before starting a level.
Galaga Arrangement - Ultra Upgrades: Let your ship get stolen and then let another bug steal your ship. Kill one and get the power-up, then Kill the other bug and you will then get an Ultra upgrade. Repeat this process using different bugs.