I just updated my ipad 2 to the latest OS (4.3.5) and battery drain is slightly better from previous OS (4.3.1), around 4% in 10 hours, where it used to be 6% in 8 hours. Is this normal?

please help by responding, it would make me feel better if this is normal and everyone else's results.

If you have notifications turned on or location services - anything that could be going on in the background, I would say you are OK. If you have nothing going on in the background, you shouldn't lose any battery power overnight - say 8 hours or so - if the iPad is asleep. I don't lose any battery power if I have a full charge and I let the iPad sleep all night long.
In your case, performance improved (battery drainage) so I think that's a good thing.

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