If you want many people playing your game, this is not the right place. The arcade is more an hosting platform than a way to get an audience.
But in my opinion, yes you should upload a new version and hide the old one. Some people browsing the arcade could discover your game (the improved and better version)
Thank you for your reply. When the game is in a more complete state, where would you suggest uploading it to? I feel like it would get lost in a sea of much better games if I were to upload it on to a site like kongregate. At a much later stage of development, or maybe with a different game, I would like to try to get a game on steam, but before that point I want to choose a platform that I can release a demo on to get some people interested in the game.