Concurrent Updates in Oracle: Locking or not?
You're right, this will lock the row regardless of the isolation level. With MVCC you can get consistent reads with no locks, but you still need locks when writing.
The second transaction will wait for the first one to finish (eg: COMMIT or ROLLBACK) before attempting to do anything. So in this case the cursor on T2 would "hang" on the update, waiting for T1 to finish.
You'll get a new SCN after T1 commits and another after T2 commits.