but how could the blockchain be altered just to accomodate namecoin? did everyone have to update their clients or something?
The ones who needed to update are those who want to write to coinbase field (i.e. solo merged miners or merged pool operators).
The ONLY purpose of the coinbase field is to provide different block header hashes. Once a block is signed the coinbase field serves no purpose except if a client needs to validate a block. Even then it is just an arbitrary number.
To bitcoin client the namecoin hash is just an arbitrary number. Pretty smart huh? Putting the namecoin hash in a field which is an arbitrary number.