If you just updated to current latest version of WordPress 3.4.2 and finds out the custom fields is not updating and broken you are not alone. Its happening for everybody. Its a known bug for WordPress 3.4.2. Here we have a quick fix before WordPress 3.4.3 arrive.
Here is the core trac ticket – http://core.trac.wordpress.org/ticket/21829
Fix: The next milestone version will be WordPress 3.5 but as its a critical bug its already fixed in rev.21780 so it could be released early on 3.4.3.
Nacin already put together the fix and packed it with WordPress Hot Fix plugin.
So just get the HotFix plugin for WordPress from Extended – http://wordpress.org/extend/plugins/hotfix/
Before the HotFix release there was a simple one file plugin, could be found here, if you just put this file in wp-content/plugins and activate the plugin it will also solve the issue.
But I also recommend getting HotFix as it will solve future critical bug before next version release.
Note: After reading this dont think that WordPress 3.4.2 will bring bug and you should not update. Thats not true. You should immediately update to latest WordPress version as it become available. This 3.4.2 also solves 21 critical bug, check here.
We have a plan to include auto update in WordPress just like the way Google Chrome do. So you have have to worry about version and update, it will happen automatically in background.