Would it run 2.3.4? Probably. Your challenge there would be to find an Airpad ROM with 2.3.4, though. Supposedly X10 anticipates to release a version of Anrdoid 4.0 in the coming months, so I'm sure they'll skip 2.3.4 entirely. If you really want 2.3.4, your only bet is probably an unofficial release from the development community – and I wouldn't hold my breathe since most of them probably have their sights set on other projects.
The Airpad comes with 2.3.1, which is virtually identical to 2.3.4. The main difference is that 2.3.4 has better support for video chat. However, even with 2.3.4, there's questions about whether the Airpad's camera would still work with most video chat software.