PostgreSQL ALTER TABLE ... ADD COLUMN is an O(1) operation, and requires no data rewrite (as long as you are OK with NULLs).
You can even add an attribute to a composite type, and existing tables using that type will see the extra attribute. Again, O(1), no data rewrite.
This way, you're hitting a limited number of rows per iteration, significantly softening the IO impact (granted, at the expense of wall-clock time); the NOWAIT fails fast on rows that have write locks out against them when you try to grab them; and (if the column you're populating is indexed, obviating HOT updates) leaving a radically smaller number of dead tuples — particularly if you up-tune autovacuum on the table in question while doing this (though that can mitigate some of the reduction in disk IO).
Additionally, however, if you're bulk rewriting the table in one query, autovacuum has no (or very limited) opportunity to mark dead tuples as truly dead — especially if there's any lock contention going on, so other, older xids are waiting for your bulk update to complete — so in the worst case your table is half dead tuples, and twice the size it needs to be.