Are in-place upgrades possible and supported on RHEV 3?

Yes, in-place upgrades are possible between minor versions if done properly.

Running 'rhevm-upgrade' should update all RHEV-M components, assuming all connections to Red Hat Network, entitlements, and repos are active.

To upgrade the RHEV-H hypervisors, you should be able to place the hosts into maintenance and then click the 'reinstall' link, again assuming that the repositories on the hosts point to the correct location.