When working with AJAX to create a better UI, I like using javascript controls instead of .Net server controls inside update panels.
The Asp.Net GridView is great for normal server-side generated pages but it's not right for client side UI.
I needed a control that allows creating the grid on the client side and supports client side sorting and column drag & drop.

I found this control which does the basic sortable table with drag and drop but it missed some key features.

After a lot of customization, I now have a control that supports links and string formatting on the client side.
I am currently working on clearing up the code and separating it from other features of our system so I can release it (watch this space...)

so if you need a nice little grid view that you can easily customize to your needs, I would go with the WebFX control, I couldn't find any other control that's close to it and this one is free.