I say go for it! But then again it depends on your career goals. Personally I'm interested in transportation planning(short-term) with an eventual goal of moving into the upper levels of public management in transportation(long-term). So in the short term I'll be happy with my MUP but I realize if I want to move into the highest managerial positions(I aim high -- Secretary of Transportation maybe?) in the public sphere an MPA degree is a necessity. I'm planning to apply to the joint MPA/MUP program at USC this upcoming fall. My advice would be to think about each masters degree and ask yourself "why do you want it?" and "what purpose does it serve my short and long-term career goals?". Best of luck!
Um, I think it doesn't really matter to be honest since most planning programs these days place a heavy emphasis on public policy anyway, you shouldn't have any problem being promoted to the upper echelons as long as you do your job well as a planner (be creative, hard working, and network!), and I think that's true no matter what the degree. As long as you have a strong academic background to prove your competence and you show it in your work, don't worry about it. Pursue what interests you!
That said, you could probably get by very well in transportation planning with an MPP or MPA!
IMO, political connections in washington are going to play a huge role in becoming a Secretary of USDOT. I was very fortunate to earn experience working for two state representatives and a state treasurer, both during campaign/non-campaign years, so I "think" the same rules apply at the federal level. Not only will have to know your job as a transporation planner/administator, but you also need to start building up your network in Washington, which may take years/decades if you want to move into the number one spot. Alot of cabinet positions are also awarded to former congressmen (Norman Mineta was in congress for years before Clinton? appointed him).